Among the main developments:
- The US current account deficit widened further in the first half of this year though the deficit grew only slightly in the second quarter; discrepancies in the accounts obscure the full picture of world payments.
- Though reviving somewhat in recent months, the syndicated credits market has been subdued this year. Most of the 'spontaneous' lending has been to OECD countries.
- Uncertainties about US withholding tax (repealed in July) discouraged activity in the international bond market for a time in the second quarter.
Floating-rate notes continue to thrive as a source of finance (the FRN market is described in the article).
- The strength of the dollar was a feature of foreign exchange markets. Sterling was weak against other currencies, too, at times in July, but subsequently recovered.