Sunday, April 19, 2009

America Could Be Exporting Deflation Soon

DUBAI, April 19 (Reuters) - Gulf Arab states, most of which peg their currencies to the U.S. dollar, risk deflation if consumer prices fall in the United States and other Western economies, Deutsche Bank's regional CEO said on Sunday. "The transmission mechanism is clear. If there is deflation abroad it will be transmitted through the exchange rate, through the interest rates," Henry Azzam said on the sidelines of a banking conference.

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