IMF warning over world economic outlook

World economic growth is set to be significantly weaker than previously thought, the International Monetary Fund states as it urged the Eurozone to break the vicious circle of retrenching banks and governments, falling lending and recession.

Despite more benign market conditions and better economic data, including improved business activity indicators in January, the fund predicts weak momentum from the sovereign crisis of late 2011 will push Eurozone economies into recession even if a new crisis is averted.

The IMF joined the World Bank in warning that a failure of the euro would prompt another global recession on the scale of that which followed the collapse of Lehman Brothers in 2008 ... READ MORE

Released by the Financial Times 26 January 2012