World and National News

• Three explanations for the fall of the euro

Failure of growth. Treatments austerity that accompany the bailout of the countries of southern Europe are likely to weigh on growth prospects for the euro area, the lowest in the G20 in 2010 and 2011. The growth gap with the United States is widening. "The most marked signs of recovery in the U.S. favor the dollar. One can expect that the Federal Reserve increased rates before the European Central Bank, "said Clemente De Lucia, an economist at BNP Paribas.

Mistrust of state debts in southern Europe. Investors are getting rid of all debt of the euro area, primarily those of the South. They believe that risk still threatening debt restructuring Greek, and are wary of Spanish titles, Portuguese or Italian, considered less safe than before."In the whole euro area, debt maturities until 2013 are 2300 billion euros, three times the European stabilization plan," said Jean-Christophe Caffet, Natixis. "Previously, investors sold securities to buy Spanish or Portuguese to French or German debt. Today, they buy everything except the euro, "said the expert of Natixis. The markets took refuge on the dollar and gold.

Political doubts about the euro area. "There are doubts about the euro area as institution-building solidarity between Member States fiscal and monetary conservatism. It destabilizes markets that sell the euro, "said Gilles Moec, economist at Deutsche Bank. Purchases of debt by the ECB are freeloaders.

• The consequences of a devaluation

Boosting exports.The weaker euro restores mechanical competitiveness to European products. "A drop of 10% of the euro against other currencies, that is 2.5 points higher for exports, 0.5% more growth in the first year and 0.5% next year "said Jean-Christophe Caffet, Natixis. The effect should be stronger for Germany and Italy, whose volume of trade is more important outside the euro area as Spain or Portugal.

Rising oil prices. It's a risk, but it is content for now by the rising dollar. The oil exporting countries have no incentive to increase the price of a barrel in MECC, because they sell in dollars and buy in euros, an optimal configuration for them. Rising commodity prices depend on demand from emerging countries.

Resumption of inflation.The drop in euro adds the price of imported products, which can boost inflation in the long term. But in the short term, the euro area rather deflation risk, fueled by rising unemployment and austerity measures.

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"The euro continues to be severely attacked

Sanofi-Aventis and Novartis, the case is closed. For Glaxo-Smith-Kline, not yet. The French state, which had ordered millions of vaccine against H1N1, was canceled last January some of the orders, forcing him to pay compensation to these laboratories.

In all, the French government had ordered 160 million doses of vaccines, including 94 million to Sanofi Pasteur, the vaccines arm of Sanofi-Aventis European leader, at 50 million British Glaxo-Smith-Kline (GSK) and 16 million Swiss Novartis.

While the epidemic of influenza was less concern, the Health Minister, Roselyne Bachelot, has gone back on his feet and set aside 2 million doses from Sanofi-Aventis. Novartis has seen its order reduced by 7 million units, while GSK shipped 32 million in vaccines and less.