Economic growth to slow down in G7 countries: OECD

09:57, April 08, 2010      

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Economic growth will slow down in Europe, the United States and Japan in the first half of this year after an active up-trend in the last quarter of 2009, the OECD said Wednesday.

The Group of Seven countries would see a quarterly growth of 1.9 percent in the first quarter of this year, with the United States grew by 2.4 percent, outpacing Japan and the three largest euro area countries -- Germany, France and Italy, the Paris-based Organization of Economic Cooperation and Development (OECD) estimated in its report.

That will be followed by an increase of 2.3 percent for G7 as a whole in the second three-month period, which was quoted by OECD Chief Economist Pier Carlo Padoan as evident signals of rapid recovery.

However, compared to the 3.7-percent quarterly growth recorded in the end of 2009, the slower pickup also indicated the fragility of the recovery, Padoan underlined in the report.

"A number of factors are expected to bear down on activity in the very near term. Support from the inventory cycle is set to begin to fade and some fiscal stimulus measures are expected to come to an end," the report said.

Besides, "sluggish credit growth and weak labor markets" would drag down the private demand and thus negatively affect the resilience, Padoan added.

He additionally warned that banks and other concerning financial institutes yet remained vulnerable to credit losses, though many have improved their capital position and showed favorable performances.

Source: Xinhua


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