As the eurozone problems rumble on, investor despondency appears to be growing. Yesterday, EUR/USD fell to a new 2012 low; further weakness beyond 1.25 over the rest of May would pave the way for a run at 1.19 later in the year. This is having an extreme impact on commodity prices with the broad based CRB index falling sharply, scything through important support. In turn this is feeding through to inflationary expectations, which in Europe not surprisingly are falling precipitously.
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Barclays Capital