APD Chief Economist Says Slowing Growth Overseas Poses Biggest Risk To US Economy

The chief economist for industrial giant Air Products & Chemicals (APD) said Wednesday that the primary external risk to the U.S. economy was faltering growth overseas.

Speaking at an Economic Outlook Conference at Georgia State University in Atlanta, Duncan Meldrum also noted possible risks from inflation throughout the world, global credit contraction and political risks such as Russia's recent invasion of its neighboring nation of Georgia.

Meldrum said the growth outside the U.S. was slowing more than had been previously thought. As examples, he noted that Spain was "at risk" and Ireland was probably in a recession.

Meldrum stated that over recent years, the economic growth outside the U.S. has been substantially higher than domestic growth - with the gap between the two of a size not seen since at least 1995.

This stronger overseas growth has provided a boost to U.S. exports, which has helped to mitigate the impact of the decline in the housing industry.

On inflation, Meldrum said that increases in Asia were more worrisome than elsewhere in the world, as the inflation increase seems to be moving into wages.

The uptick in inflation in the European Union is less a source of concern, the economist said, largely as the result of high confidence in the European Central Bank to maintain price stability. Copyright(c) 2008 RealTimeTraders.com, Inc. All Rights Reserved