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 ]

The world is heading towards a global recession, latest forecasts from the International Monetary Fund (IMF) have predicted.

In it’s latest report International Monetary Fund (IMF) have predicted world growth could slow to 3.7 % in 2008— 0.5 % point lower than what was forecast in the January 2008, citing the unfolding financial market turmoil as the biggest downside risk to the global economy.

There is a 25 percent chance that the global economy will record 3 % or less growth in 2008 and 2009, equivalent to a global economic recession and market recession.

(Image credit: IMF)

Global growth will decelerate in 2008, led by a sharp slowdown in the United States, amid a housing correction and a financial crisis that has quickly spread from the U.S. subprime sector to core parts of the financial system, the IMF says in its latest World Economic Outlook.

China and India–which grew at 11.4 percent and 9.2 percent in 2007, respectively—are projected to grow at 9.3 percent and 7.9 percent, respectively, in 2008.

• World growth will slow to 3.7 percent in 2008, in wake of financial crisis
• United States, other advanced economies lead slowdown
• Emerging economies are likely to weather storm better, but not insulated.

Via - IMF

AT&T, one of the foremost providers in the US and the sole provider of the iPhone, is targeting India as it seeks to expand its consumer mobile phone operations outside America.

AT&T is keen to expand overseas, particularly in emerging markets such as India and the Middle East.

“We are looking at India because it has very attractive growth opportunities,” Ralph de la Vega, chief executive of AT&T’s mobile business, reported Financial Times.

Indian Finance Minister P. Chidambaram tabled the Economic survey 2007-08 in the Lok Sabha . Here are the highlights of the survey.

Economic survey 2007-08 highlights

• India needs second green revolution.
• GDP projected to grow 8.7 % in 2007-08, against 9.6% a year ago.
• Fiscal deficit to be kept below 3 percent in 2008-09.
• Inflation to decline from 5.6% in FY 07 to 4.4% in 08.
• Dearth of skill causing attrition, wage hike; pushing inflation.
• Farm growth in FY 08 seen at 2.6%, against 3.8% a year ago.
• Foodgrain output seen at 219.3 MT in FY 08 against 217.3 MT in FY 07.
• Acceleration in domestic investment, savings drove growth.
• Macroeconomic fundamentals continue to inspire confidence.
• Industrial growth slower at 9% in first 9 months of FY 08.
• 100 % foreign direct investment (FDI) in home appliances, rural agricultural banks.

Concern

• Concern: Labour force growing faster than employment growth.
• Concern: Costly rupee, sluggish consumer goods and infra a concern for the economy.

Challenge

• Challenge: Maintaining 9% GDP growth.
• Challenge: Inflation and infrastructure biggest challenges for growth.