One more post showing the volatility of the foreign currency exchange markets and the depressed state in Europe that may adversely impact those companies that report in Euros or Pounds even if the bulk of their profits are earned elsewhere.  This could potentially continue beyond the time when economies in the rest of the world have begun to recover making comparisons of profitability between companies difficult.

The U.K. pound will continue to face head winds “as the new government will have to present a credible budget in order to avoid its sovereign debt losing its triple-A status” granted by ratings agencies, BNP Paribas analysts said.

Meanwhile, the euro zone’s stressed sovereign debt continued to draw the focus of investors, with the euro failing to benefit from a report showing the euro-zone economy returned to growth in the first quarter.

Pound Falls  as Focus Shifts to U.K. Deficit. Bradley Davis. Wall Street Journal. (Eastern edition). New York, N.Y.: May 13, 2010. pg. C.2