However, despite these favourable developments, there is again no time for complacency. In many countries structural reforms are far from finalised, as a report by the EU Parliament suggests. At the same time, public debt is still very high in many countries and has to come down.
The greater rates of productivity growth in the United States, compared with still-subdued rates abroad, have apparently engendered corresponding differences in risk-adjusted expected rates of return and hence in the demand for U.S.-based assets.