The U.S. GDP should fall by 0.9% in 2009 but then increased by 1.6% in 2010, believes the organization. The unemployment rate increased to 7.3% in 2009 and 7.5% in 2010.
The U.S. economy, which is in recession next year and will undergo the most marked slowdown across the OECD area, "going through a very difficult," says the Organization for Economic Cooperation and Development (OECD ) Tuesday.
The Organization today published a series of forecasts marking a severe recession in OECD countries, accompanied by rising deficits and a marked increase in unemployment. France is no exception.
"The United States that the activity should be getting more heavily toward the end of this year," noted the OECD in its half-yearly economic outlook. This provides a recovery in the third quarter of 2009, but slower, growth not to regain its cruising speed that by mid-2010.
GDP should grow by 1.4% in 2008 and then decline by -0.9% in 2009 but then increased by 1.6% in 2010, even though "the recovery will probably be languishing". The unemployment rate is expected to increase to 7.3% in 2009 and 7.5% in 2010. Consumption will lag behind because of unemployment, falling stock markets and that of real estate that affect household wealth, also face more difficult access to credit. The decline in spending will be particularly pronounced in the automotive sector.
Housing prices continue to decline as activity in the construction sector but "there are signs that the contraction of the housing market may be abating now," says the OECD. "Business investment is also likely to continue to weaken, given the low level of confidence and sudden tightening of financial conditions," said the Organization. The continued support from export (...) seems blurred "because of the weakening of the economy in the world and appreciation of the dollar, she adds. However, the relaxation of oil prices and commodity prices should bring inflation "around 1.5% in 2010, says the report.
"A new package of fiscal measures could become desirable in the short term, if financial conditions do not improve quickly," argues the OECD. "Once the crisis is over, the authorities should seek to restore fiscal sustainability by reducing the budget deficit, and addressing the problem of rising costs for entitlements, like pensions , She said.
It also calls for "a complete overhaul of the regulatory and financial supervision" to restore investor confidence and help revive the economy
The U.S. economy, which is in recession next year and will undergo the most marked slowdown across the OECD area, "going through a very difficult," says the Organization for Economic Cooperation and Development (OECD ) Tuesday.
The Organization today published a series of forecasts marking a severe recession in OECD countries, accompanied by rising deficits and a marked increase in unemployment. France is no exception.
"The United States that the activity should be getting more heavily toward the end of this year," noted the OECD in its half-yearly economic outlook. This provides a recovery in the third quarter of 2009, but slower, growth not to regain its cruising speed that by mid-2010.
GDP should grow by 1.4% in 2008 and then decline by -0.9% in 2009 but then increased by 1.6% in 2010, even though "the recovery will probably be languishing". The unemployment rate is expected to increase to 7.3% in 2009 and 7.5% in 2010. Consumption will lag behind because of unemployment, falling stock markets and that of real estate that affect household wealth, also face more difficult access to credit. The decline in spending will be particularly pronounced in the automotive sector.
Housing prices continue to decline as activity in the construction sector but "there are signs that the contraction of the housing market may be abating now," says the OECD. "Business investment is also likely to continue to weaken, given the low level of confidence and sudden tightening of financial conditions," said the Organization. The continued support from export (...) seems blurred "because of the weakening of the economy in the world and appreciation of the dollar, she adds. However, the relaxation of oil prices and commodity prices should bring inflation "around 1.5% in 2010, says the report.
"A new package of fiscal measures could become desirable in the short term, if financial conditions do not improve quickly," argues the OECD. "Once the crisis is over, the authorities should seek to restore fiscal sustainability by reducing the budget deficit, and addressing the problem of rising costs for entitlements, like pensions , She said.
It also calls for "a complete overhaul of the regulatory and financial supervision" to restore investor confidence and help revive the economy
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