The United States is heading towards recession with major global slowdown amid financial crisis International Monetary Fund (IMF ) in its latest World Economic Outlook (WEO) predicts.
- World growth will slow amid most dangerous financial shock since 1930s
- No growth in many advanced economies until at least mid-2009
- Global economy expected to stage modest recovery later in 2009
IMF said in its report
The world economy is entering a major downturn in the face of the most dangerous financial shock in mature financial markets since the 1930s.
For the remainder of 2008 and early 2009, the U.S. economy faces flat to negative growth as support from the fiscal stimulus ebbs, export momentum moderates, and tight financial conditions take an increasing toll. An emerging turnaround in the housing sector and more stable oil prices should help lay the basis for incipient recovery in the second half of 2009, but the revival is expected to be much more gradual than in previous business cycles, as tight credit conditions continue to weigh heavily on domestic demand.
(Image credit: IMF)
Growth in emerging and developing economies is also projected to continue to decelerate, falling somewhat below trend during the second half of 2008 and early 2009, before picking up in the course of the year. During this period, overall growth in these countries is projected to remain well above rates experienced in the 2001-02 global downturn, According to IMF.
[ IMF ]