London, London United Kingdom (PressExposure) June 30, 2010 -- “Omega-Trading” believes that the forthcoming G20 meeting in Toronto, Canada may serve to highlight the growing differences in the European and US approach to deficit reduction.

“Omega-Trading” analysts say that mounting evidence of the slowing of the US economic recovery has effectively ended intense speculation of when the Federal Reserve would begin tightening monetary policy whilst, in Europe, the Greek debt crisis has seen attention shift from stimulus to debt reduction as yields being demanded on sovereign debt have soared.

The firm says that US Treasury Secretary, Timothy Geithner, will be looking to persuade European leaders to take a softer approach to deficit reduction so as not to stifle the fragile global economic recovery but it is more likely that he wants to ensure that demand for US exports remains relatively robust.

“Omega-Trading” said that poor recent economic data on the employment, consumer spending and housing fronts in the US have galvanized fears that the US economy is still on life support despite early optimism.

One “Omega-Trading” analyst explained that as the US held the world’s reserve currency to which many investors retreat in times of turmoil, yields on US debt were approaching lows not seen since the Lehman collapse, making it cheaper for them to borrow from the markets. Some European countries and the UK, by contrast, have seen yields on their debt rise as investors worry about their ability to service their debts.

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