THE TELEGRAPH: The world is mired in what future generations may dub the "Great Recession", the head of the International Monetary Fund has declared, in the face of a flurry of negative economic news.
The global economy faces a contraction in overall gross domestic product for the first time since the Second World War, said Dominique Strauss-Kahn. His warning came as:
• Britain's leading economic forecaster, the National Institute for Economic and Social Research, said the UK economy has given up more than two years' worth of expansion, sliding back to the same size it was in summer 2006. It added that the recession had deepened in the first quarter of the year.
• China slid into deflation for the first time in the crisis, underlining the fact that Western nations' reliance on Chinese growth in the recession may be futile.
• Evidence emerged of an industrial production collapse across Europe, while the Irish central bank chief predicted his economy would shrink by a staggering 6pc this year.
• Eastern Europe's problems intensified, with the European Union pledging its readiness to give money to Romania and experts warning that Serbia's economy will shrink by 3pc unless it is bailed out by the IMF.
Mr Strauss-Kahn said that the Fund was poised to cut its forecast for 2009 global economic growth from the paltry 0.5pc expansion it predicted in January, saying a negative figure was now more likely. >>> By Edmund Conway | Wednesday, March 11, 2009
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