U.S. looks best of 2013 economic runners
Vincent Reinhart and David Greenlaw at Morgan Stanley said residential construction was likely to be the economy's standout sector. "We look for sustained improvement in starts, sales and prices over the next few years," they wrote.
James Malcolm, a currency strategist with Deutsche Bank in London, said a multi-year upturn in U.S. housing should have strong multiplier effects on jobs, tax receipts, personal wealth and confidence - all bullish for the dollar.
The United States, as well as China, also looks attractive to Singapore-based Richard Martin, managing director of IMA Asia, an economic and business research consultancy.
Global risks should be receding by the second quarter. By then, America ought to have resolved its immediate fiscal crunch and China's new Communist party leaders will have taken over the top government posts in March, Martin said.
This should accelerate corporate investment decisions and turn 2013 into a better year than many expect: "By the third quarter there should be plenty of evidence of firm upturns in China and the U.S., which should clear some of the global oversupply."
MORE EURO HAGGLING
The data highlights of the week in Europe are German unemployment and euro-zone economic sentiment on Thursday followed a day later by November's inflation rate.
But they pale in importance next to the latest efforts by euro zone finance ministers to agree among themselves and with the International Monetary Fund on how to stave off insolvency in Greece.
Ministers meet on Monday for the third week in a row to try to agree how to fill Athens's yawning funding gap, knowing the euro itself could face a life-or-death test if Greece were to tumble off this particular fiscal cliff.
That in turn would be fatal for Europe's growth prospects and all bets on an improving trend in the United States and China would be off.
"There are different alternatives being discussed all the time. I do believe that next Monday we can reach a sustainable and credible result," Finnish Finance Minister Jutta Urpilainen told reporters on Friday.