The International Monetary Fund will next week forecast that the US economy will go into recession this year, a German newspaper reported Tuesday, citing an upcoming report.
The IMF believes the US will experience at least two successive quarters of negative growth — the technical definition of a recession — and will grow only half a percent over the whole of 2008, weekly Die Zeit reported.
Previously the IMF, which will release the report at its spring meeting together with the World Bank next week, had forecast US growth this year of around 1.5 percent, the newspaper said.
The IMF will also lower its forecast for world growth from the current 4.1 percent, Die Zeit said.
For Germany, Europe’s biggest economy, the IMF will cut its growth forecast to 1.2 percent from 1.5 percent, government sources said.
The sources said though that the German government’s forecast of 1.7 percent still stands.
Tue Apr 1, 12:48 PM ET