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Recession risk rising -survey

Thursday, September 15, 2011 - 02:16

Sept. 14 - Summary of business headlines: Reuters poll predicts one-in-three chance of U.S. recession; August retail sales and producer prices unchanged; IMF head says ''global economy has entered a new danger zone''; Germany, France say Greece to stay in Euro; Stocks post solid gains. Conway G. Gittens reports.

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NOTE: QUALITY AS INCOMING ON ROBERT ZOELLICK SOUNDBITE The U.S. economy is now facing nearly a one-in-three chance of going back into recession sometime within the next 12 months, according to a new Reuters poll. Economists have lifted that probability from a one-in-four chance just a month ago. Harvard University Economist Martin Feldstein puts the odds of a so-called double dip even higher. SOUNDBITE: MARTIN FELDSTEIN, HARVARD UNIVERSITY ECONOMIST (ENGLISH) SAYING: "I think there is a better than even chance that we will see ourselves in a recession sometime in the coming year. Are we already in it? Well the people who analyze the GDP numbers on a monthly basis, tell us that the number was higher in December than it was six months later, that it had fallen four out of the six months in between, so we may be sliding into a recession." Bolstering that case: U.S. retail sales were flat in August. Consumers turned more cautious as job growth stalled, the debt battle raged on in Washington, and the stock market suffered big losses. Producer prices were also flat in August. The International Monetary Fund and World Bank meet this weekend in Washington. Ahead of that, World Bank head Robert Zoellick warns the global economy has entered a new danger zone. SOUNDBITE: ROBERT ZOELLICK, PRESIDENT, WORLD BANK (ENGLISH) SAYING: "Unless Europe, Japan and the United States also face up to their responsibilities they'll drag down not only themselves, but the global economy." Europe's troubles spilled out onto the streets of Italy. Hundreds of protesters clashed with police outside the parliament building in Rome as lawmakers gave final approval on an unpopular austerity package. Meanwhile, France and Germany say Greece should not be kicked out of the euro zone. Wall Street welcomed signs of progress in Europe's debt crisis - sending U.S. stocks higher for a third day in a row. And markets across Europe rallied as well, led by a more than 3 percent gain in Germany. Conway Gittens, Reuters

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Recession risk rising -survey

Thursday, September 15, 2011 - 02:16