Stephen Roach: Worried about everything, except China

Stephen Roach, former chairman of Morgan Stanley Asia says that the lack of consumer demand is hurting US economy and remains worried about the prospects of growth in the region.

US Treasury debt prices rose on Tuesday, pushing benchmark yields below 2% for the first time in over four weeks as worries about the pace of global economic growth bolstered demand for safe-haven US government debt. Benchmark yields were still being impacted by March US jobs growth that came in well below expectations last week, casting doubt over the strength of the US economic recovery. Speaking to CNBC-TV18, Roach says, the US Fed may resort to another round of quantitative easing on growth concerns. Before the jobs data, market participants had interpreted recent comments from Fed policy-makers and improved data to mean the bar for further monetary stimulus was extremely high. But the biggest worry for global economy still remains Europe. Though the ECB has averted a full-blown crisis, the growth revival poses a big challenge for the European Union, Roach reiterated. The picture is not all that good for India either. According to Roach, the high fiscal deficit in India remains the key concern with low scope for any stimulus, even from the Reserve Bank of India. The one bright spot, Roach highlights in this dismal environment, is China. And though the Chinese growth has slowed down, he feels, the concerns expressed by many analysts were "overdone". He says commodity markets will continue to take cues from Asia