Global economy grinds to a stop, according to the International Monetary Fund
David Uren, Economics correspondent | January 28, 2009
Article from: The Australian
THE world economy is at a standstill, with the major developed countries in deep recession, according to leaked forecasts prepared by the International Monetary Fund.
The third downward revision to the IMF's forecasts in the last four months comes as layoffs affecting more than 70,000 workers were announced around the world on Monday.
The IMF is due to release new official economic forecasts before the end of the week. However, a well-sourced report carried by Reuters news agency says it expects global growth of just 0.5per cent this year.
The fund has been struggling to keep up with the rapidly deteriorating world economy, having cut its estimate for world growth next year from 3.8 per cent last April to 3 per cent in October and 2.2 per cent in November.
The latest update anticipates sharply slowing growth in China and India.
The US economy is expected to contract by 1.6 per cent, while Europe will shrink by 2 per cent and Japan by 2.6 per cent.