World Economy

Within the U.S. Federal Reserve's concerns grow over the situation in the euro zone. "I am very concerned about the risk of a renewed worsening of the debt situation in the European countries and the European financial system. The worst is not over yet."

Within the U.S. Federal Reserve's concerns grow over the situation in the euro zone. "I am very concerned about the risk of a renewed tightening in the debt situation of European States and the European financial system. The worst is not over yet," said John Williams, a member of the Monetary Policy Committee of the U.S. central bank and head of the largest Federal Reserve branch in San Francisco, the "Handelsblatt" (Monday edition).

He was skeptical that the austerity budgets in many European countries the right way to resolve the crisis. "I will not tell other countries what they should do. But when the economy is weak, while saving too many countries, it is for the states with severe problems to get back to normal economic performance," said Williams. And that makes it even harder to tackle budget deficits and debt. We must find the right balance.

The position of the U.S. economy has improved after Williams' last opinion. Therefore he sees no reason for the time being also, again to raise the money printing machine. Although there were risks, such as the situation in Europe. "But still there is no need for new monetary policy measures," said Williams. This could change if, for example, the unemployment rate is stagnating or climb significantly.