US economy starts the year 2012 with continuing momentum gained on 2011.
2011 should be the year that pulled US away from the risk of recession.
Continuation of good economic data shows signs of resilience, mainly including from its housing market. On the other side of the stability is the Euro-zone that will continue its recession next year, in the meantime manages to avoid a collapse of the financial system that will lead to a break-up of the Euro currency. Remaining risks of potential credit-rating downgrades for European sovereigns and banks, still keeps investors cautious. One more important step towards stability by the European Central Bank’s (ECB) was the intentions to supply unlimited three-year liquidity to the European financial system. That alone will not solve stability risks, since the austerity measures that need to be taken will face abysmal culture's differences, deep recession without a real pragmatic approach to lead a sustainable growth. With that being said 2012 is likely to be another volatile year for financial markets as households, companies and even governments find it more difficult to borrow to smooth their spending in the face of shocks.
Mr. King, the governor of the Bank of England advises that “Overall conditions have worsened,” and   Mr. King says, “In a climate of extreme risk aversion, investors lack confidence to continue to provide a normal level of funding to financial institutions,”
Mr. King called on banks to work hard to increase their level of capital over the next six months but “not by reducing lending to the real economy.”
The People’s bank of China unexpectedly announced a half-percentage-point cut in its reserve requirement ratio for banks, signaled a shift from an inflation-fighting policy begun in early 2010 to one of the supporting growth, highlighted emerging economies amid slowing growth.