IMF Sharply Downgrades Outlook for U.S, Europe

September 20, 2011

WASHINGTON (AP) — The world economy has entered a "dangerous new phase," according to the chief economist of the International Monetary Fund. As a result, the international lending organization has sharply downgraded its economic outlook for the United States and Europe through the end of next year.

The IMF expects the U.S. economy to grow just 1.5 percent this year and 1.8 percent in 2012. That's down from its June forecast of 2.5 percent in 2011 and 2.7 percent next year.

To achieve even that still-low level of growth, the U.S. economy would need to expand at a much faster rate in the second half of the year than its 0.7 percent annual pace in the first six months.

Most economists expect growth of between 1.5 percent and 2 percent in the final two quarters. Though an improvement, it wouldn't be enough to lower the unemployment rate. The rate has been 9 percent or higher in all but two months since the recession officially ended more than two years ago.

"The global economy has entered a dangerous new phase," said Olivier Blanchard, the IMF's chief economist. "The recovery has weakened considerably. Strong policies are needed to improve the outlook and reduce the risks."

The IMF has also lowered its outlook for the 17 countries that use the euro. It predicts 1.6 percent growth this year and 1.1 percent next year, down from its June projections of 2 percent and 1.7 percent, respectively.

The gloomier forecast for Europe is based on worries that euro nations won't be able to contain their debt crisis and keep it from destabilizing the region.

"Markets have clearly become more skeptical about the ability of many countries to stabilize their public debt," Blanchard said. "Fear of the unknown is high."

Keep reading > >

Comments are closed.

GET

Jerry
Robinson's

Best

SELLING BOOK

PURCHASE TODAY

PRAISE FOR JERRY 'S BOOK
"Jerry Robinson does an excellent job of explaining the 'Petrodollar' system. His book explains exactly how this will come about, but equally important is the comprehensive section on what you can do to protect yourself."- G. Edward Griffin, Author and Film-Maker

Paperback | Audiobook

Download Free Chapter

Precious Metals Update (Sponsor)

Listen as veteran precious metals advisor, Tom Cloud, keeps you up-to-date on the gold and silver markets. Updated biweekly.

FREE DOWNLOAD: Gold and Silver Investor's Kit

Join Our Community

Join Today!

Unlock instant access to:

- Daily trading ideas
- Model portfolios
- Ongoing video education
- Daily premium newsletter
- And much more!

Profitable Trading Ideas

View our Trading Services

PODCAST: The Bitcoin Bull Market

Nov 6, 2024

Segment 1: Bitcoin Bull Market (What Trump's Win Means for Crypto) SEGMENT BEGINS AT 02:50 In this segment, Jerry Robinson explores why Bitcoin is setting record highs and looks at the potential implications of Trump’s pro-crypto stance. He discusses: Bitcoin’s...

The 30-Minute Breakout Blueprint (Module 4)

Nov 5, 2024

(Recorded on 11/5/24) In Module 4, we’ll explore the power of VWAP—a crucial tool that helps confirm breakout strength, filter out false signals, and fine-tune your entries. Learn how to integrate VWAP into your trading setup for smarter, more confident...

401(k) Catch-Up Contribution Limits to Rise in 2025: Key Updates

Oct 30, 2024

If you are saving money in a 401(k) — or similar plan like a 403(b) — this update is for you. New tax rules have increased the catch-up contribution limits for workers aged 60 to 63, to the tune of an extra $10,000 per year – or 150% of the catch up...

Please help us spread the word about FollowtheMoney.com on Facebook, Twitter,
and any other social media outlets.

Silver & Gold

Call 800-247-2812 now for the best prices on gold and silver coins and receive Free Shipping and Insurance when you mention Follow the Money.

Weekly Newsletter

Stay in the loop!
Sign up today to receive our
weekly e-newsletter.

FollowtheMoney.com Exclusives