Continued mistrust of the US?

The return of the public deficit theme, rekindled by the US tax bill and Moody’s downgrade of the US credit rating last Friday, dominated the week, resulting in a fall in the dollar and strong pressure on interest rates. Next week, there will be a raft of major macroeconomic releases, with notably core PCE and the second GDP estimate in the United States, and inflation figures in Europe which could validate the ECB’s accommodating policy.