US economic indicators show tough week ahead

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As more and more indicators show that a slowdown in the world economy is impending, as the short term forecasts for US stocks aren't too good, many investors can seek refuge this coming week with the world's central banks.

One of them, the US Federal Reserve would be meeting this week to continue its activities in purchasing bonds worth nearly US$85 billion in order to buoy the lower than expected growth for the first quarter of 2011.

The low interest rates and liquidity fostered by the Fed and other central banks have boosted equity markets worldwide. The low cost of borrowing for businesses and investors would lead to higher profits, as seen in the latest US stock indices that have hit record highs this month alone.

The week is also the time for many reports on economic indicators would be released. These include personal income and spending, manufacturing and services index, pending home sales among others. This can give a fuller picture of what lies ahead for the US economy.

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