US market robust despite gloomy year

In recent months market commentators have been queuing up to forecast stagnation, even recession, for the US economy. But despite the gloom, economic growth in America has been surprisingly robust. The weak US dollar has supported good growth in exports and the consumer is still spending briskly despite the headwinds from higher gasoline prices and mortgage costs. But as credit for consumers is being constrained and job prospects are faltering, it is almost inevitable that the economy will slow appreciably in 2008. In response, we expect that the Federal Reserve will attempt to soften the...