The international environment

• In the first quarter of 1995, growth slowed in the United States and was very low in Japan. In continental Europe, the recovery remained generally strong; and growth rates quickened in some economies. In the second quarter, US growth weakened further.
• Non-oil commodity prices were, on average, 21/2% lower in the second quarter than in the first, according to the dollar-denominated Economist index. Oil prices rose sharply and then fell: by June, they were only slightly higher than in March.
• Producer and consumer price inflation have risen in those major economies whose currencies have depreciated this year.
• Inflationary pressures have diverged within Europe; as a result, official interest rates have been raised in some countries and cut in others.

The international environment