One month is not a trend. Just the slowing U.S. economy is not enough to quell current account concerns in the long run.
What makes some red in the face is that (Greenspan) can speak about Fed policy and the economy just days after leaving the Fed, when his insights are most relevant. Look at Eurodollar futures today if you have any doubt.
Otherwise a spend-prone fiscal policy teamed with a pro-growth monetary policy could be problematic for the U.S. economy and currency ahead.
We have to start thinking about the Fed moving from a neutral to a more restrictive policy. I wouldn't rule out a 6 percent Fed funds rate if the economy stays hot.
If there is any significant slowing in the U.S. economy in the next 12 months, it will be good-bye surpluses and hello big fiscal stimuli and deficits, and welcome higher U.S. rates,
And slowdowns in the U.S. economy and the Asian regional economies, along with high oil prices, raise questions about fourth-quarter growth in Japan,
The market is pretty bullish on the dollar. With the U.S. economy enjoying low inflation and strong growth, and with the stock market picking up again, it makes it a tough go for the euro.