Against the background (before the Iraqi invasion of Kuwait) of continuing growth in the major overseas economies, despite confirmation of sluggish US performance, and (now even) higher oil prices which threaten the decline in inflation, this Assessment considers three themes: the balance of savings and investment in public and private sectors in the West and the needs of Eastern Europe; the financial strains which are particularly acute in the United States but also evident in Japan and the United Kingdom; and exchange rate tensions within the ERM which provide a context for sterling's welcome recent strength. The implications of this last development for UK policy are also considered.
Published on
01 September 1990
General assessment