The world economic recovery is “on the ropes” with a significant threat of another slide into global recession, the latest Brookings Institution-Financial Times tracking index shows, despite the best efforts of the world’s central banks to boost demand.
As the US enters the final stages of the presidential election, the world’s largest economy is the one tentatively bright spot outside financial markets. Economic data and confidence indicators have deteriorated since the spring across the rest of the developed and emerging economies in the Group of 20. The Tiger (Tracking Indices for the Global Economic Recovery) index casts a shadow over this week’s annual meetings of the International Monetary Fund and World Bank in Tokyo, as the world’s finance ministers and central bankers struggle to find ways to generate self-sustaining growth.
The deterioration in hard data and sentiment has forced economic forecasters to lower their estimates of growth this year and next. A leak of the detailed IMF forecasts, to be published tomorrow, showed the fund revising down its 2012 global growth forecast to 3.3 per cent from 3.4 per cent in July and shaving another 0.3 percentage points off its July forecast of 3.9 per cent for 2013.