Fear of double dip intensifies

- Market Movers ahead
• "In the US we expect to see a drop in both new home sales and existing home sales. Moreover, we expect that the durable goods report will give an indication of how strong the upward trend is, notably if it has been losing pace. Furthermore, we expect a considerable downward revision of second quarter GDP."
• "The most important release in the euro area is the August flash PMI indicators. We expect PMI levels to drop a bit across the euro area as a consequence of the recent signs of slowing in the US and Asia."
• "The data calendar for next week is light in Asia. Most notably Japanese trade data will give some more input to how Japanese exports are coping with the strong JPY and how much Asia is slowing at the moment."
• "In Denmark attention will be on the Danish government’s draft budget proposal for 2011 and the accompanying economic forecast."
- Global Update
• "With another round of weak economic data out of the US late this week, the fear of a deeper slowdown has intensified. Due to continued weakness in activity data we have decided to revise the growth forecast, but we continue to believe that the risk of an outright recession is limited."
• "It has been a calm week in the euro area. In Germany the ZEW expectations index showed some weakness."
- Focus
• "Sovereign spreads in the euro area periphery have widened considerably during the past two weeks. We will take stock of the attempts to bring public finances back on a sustainable path. Our primary concern is that public support for necessary reforms may falter."

DenDanske Weekly Focus 20100820

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