World Economic Outlook in Apr 08

Today's headlines on the world economic outlook:

BBC News reports "World 'could see 70s-style slump' ": Singapore's investment agency GIC has warned that the world is in danger of sinking into the worst recession in 30 years if swift action is not taken. ... "We could be facing a recession which is longer, deeper and wider than any recession we have encountered in the last 30 years," said GIC's Mr Tan.

AP reports "30% of economists believe [US] economy will shrink in first half of year": THE odds the United States will fall into its first recession since 2001 are rising sharply. Thirty per cent of economists now believe the economy will shrink in the first half of this year, up from 10 per cent who thought this in January, according to a survey being released on Monday by the National Association for Business Economics, known by its acronym Nabe. 'That's a striking difference,' said Mr Ken Simonson, chief economist for the Associated General Contractors of America and the Nabe's point person on the survey. The tone of the overall survey, he said, was 'extremely gloomy.' Under one rough rule, if the economy contracts for six straight months it would be considered in a recession. Many economist and the public believe we are in one. Even Federal Reserve Chairman Ben Bernanke recently acknowledged, for the first time, that a recession is possible.

BBC News also reports "[UK] Economy 'facing painful slowdown' ": The UK economy is set for a "rapid, painful adjustment" over the next two years, according to an influential economic forecasting group. Growth will fall from 3.1% in 2007 to 1.8% this year and 1.5% in 2009 unless the government acts decisively predicted Ernst and Young's Item Club .

However, REUTERS reports "Asian stocks firm at closing [today] as credit fears ease": ASIAN shares powered to their highest in more than seven weeks on Monday as financial firms rallied on hopes that the worst of the credit crisis is over, and the dollar gained against the Japanese yen. ... 'The market is clearly trying to say that the worst of all these subprime and credit issues are now out, so we can move on,' said Mr Greg Goodsell, equity strategist at ABN AMRO. 'But it remains to be seen whether that is really the case. It's hard to be conclusive that there aren?t further write-offs out there in the financial sector.'