Sponsored by Digital Look Events

IMF warns of global recession

News for Spread Betters

PreviousPrevious
NextNext

There's a new Investor Edition of CMC Markets' spread betting platform... and it's exclusive to DigitalLook.com users...

Get full details about Marketmaker:Investor Edition here. Advertisement

Date: Wednesday 09 Apr 2008

LONDON (ShareCast) - The International Monetary Fund said the mortgage crisis in the US is the “largest financial shock since the Great Depression” and warned that the global risk of recession is rising.

“The US economy will tip into a mild recession in 2008 as the result of mutually reinforcing cycles in the housing and financial markets,” it said

It slashed its growth forecasts for both the US and Britain, warning that there is one chance in four that global economic growth will drop to recession levels in the next 12 months.

"The financial shock that erupted in August 2007, as the US sub-prime mortgage market was derailed by the reversal of the housing boom, has spread quickly and unpredictably to inflict extensive damage on markets and institutions at the heart of the financial system," it said.

Earlier, Alistair Darling defended his forecasts for economic growth despite the International Monetary Fund's decision to cut predictions for the UK to 1.6% for both this year and next.

The IMF figure contrasted with the Chancellor’s own expectations of 2% growth in 2008.