Fitch downgrades global growth
By
Adam Smith
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5/10/2011 1:30:00 AM
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Fitch has downgraded global economic forecasts, but says a "double-dip" recession is unlikely.
The ratings agency has revised downward its quarterly Global Economic Outlook, downgrading forecasts for all major advanced economies due to weaker-than-expected second quarter growth. Fitch pointed to volatility in financial markets and uncertainty over fiscal policies and said these factors had undermined consumption and business investment.
In spite of the downgrade, Fitch sovereign team director Maria Malas-Mroueh said a "double-dip" in the company's baseline global economic projections is unlikely.
"However, the likelihood of a recession has increased, as intensified financial market volatility could further amplify risk aversion behaviour and lead to tighter credit conditions," she commented.
Malas-Mroueh said near-zero quarterly growth was expected in the Eurozone until the first quarter of 2012.
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