PARIS – The Organization for Economic Cooperation and Development says the economic recovery in the U.S. and rich nations in Europe will stagnate or go into reverse by year-end, under the weight of government belt-tightening and falling consumer and business confidence.
The OECD forecasts the U.S. economy will grow at only a 0.4 per cent annualized rate in the fourth quarter, while in Europe, the three largest economies in the eurozone will contract by 0.4 per cent in that period.
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The OECD warned Thursday that the risk of economic contraction has increased in some major OECD economies, but said that “a downturn of the magnitude of 2008/2009 is not foreseen.”
The OECD’s update to its May forecasts comes one day before financial leaders from seven of the world’s most developed economies meet in Marseille.
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