Wednesday, May 11, 2011
Commodities, U.S. Stocks Drop on Inflation
On May 11 commodities fell for the first time in three days. Following these commodities were silver and water. U.S. stocks retreated from London and Beijing because of the inflation they were having. This inflation in turn made Beijing and London raise their interest rates. The euro will be forced to restructure debt. The Bank of England Governor Mervyn King rose the cost of their pound value. He says that the inflation occurring in England remains uncomfortably high and that interest rates will more than likely rise. As prices grew in Germany and China, Poland unexpectedly increased its benchmark rate. Europe’s debt scared them and they weren’t too sure about their stocks. Even after the economy started to get better Europes’ stocks still decreased. Unfortunately for Europe, since it went into debt and had to recover, global rates will go up. Global rates always go up after state recovers. The pound gained against 11 of 16 major peers, rising 1.3 percent versus the euro and 0.7 percent versus the Swiss franc. The won appreciated versus all 16 major counterparts after South Korea’s unemployment rate fell more than economists estimated. The euro lost more than 1.3 percent of its dollar. The Euro is now a laggard in its environment.