Skip to main content
U.S. Edition
Search
 
 
 
 
 
 
 
 
 
 
 
WORLD BUSINESS

OECD: Global economy back on track

story.construction.jpg
Economic growth in the U.S. is expected to rebound.

YOUR E-MAIL ALERTS

Economy
United States
Japan
Europe

PARIS, France (Reuters) -- Economic momentum on both sides of the Atlantic is now largely back in line with OECD projections but some of the factors sustaining buoyant growth may not continue to do so, the Paris-based think-tank said in an interim assessment on Monday.

OECD chief economist Jean-Philippe Cotis said "stretched valuations" in some housing markets were a source of risk, but noted that recent U.S. data pointed to a sharp rebound in the first quarter of 2006.

He said the Organization for Economic Co-operation and Development projected first quarter growth in the United States to be 1.1 percent, quarter-on-quarter, dipping to 0.9 percent in the second quarter of the year.

For the euro zone, quarter-on-quarter growth was expected to be 0.6 percent for the first two quarters.

"Monetary accommodation has now essentially been removed in the United States. However, with limited if any economic slack left and some pressures on costs, there may be a case for limited further tightening, subject to the incoming data, including the evolution of house prices," Cotis said.

"Japan may be at long last exiting deflation, but only very gradually so, despite vigorous growth, which argues for keeping the policy interest rate at zero over the near term.

"Further out, removal of monetary accommodation should be based on unambiguous signs that slack is shrinking and that underlying inflation pressures are mounting."

Story Tools
Click Here to try 4 Free Trial Issues of Time! cover
Top Stories
Get up-to-the minute news from CNN
CNN.com gives you the latest stories and video from the around the world, with in-depth coverage of U.S. news, politics, entertainment, health, crime, tech and more.
Top Stories
Get up-to-the minute news from CNN
CNN.com gives you the latest stories and video from the around the world, with in-depth coverage of U.S. news, politics, entertainment, health, crime, tech and more.
CNN U.S.
CNN TV E-mail Services CNN Mobile CNNAvantGo Ad Info About Us Preferences
Search
© 2007 Cable News Network LP, LLLP.
A Time Warner Company. All Rights Reserved.
Terms under which this service is provided to you.
Read our privacy guidelines. Contact us. Site Map.
Offsite Icon External sites open in new window; not endorsed by CNN.com
Pipeline Icon Pay service with live and archived video. Learn more
Radio News Icon Download audio news  |  RSS Feed Add RSS headlines