Monday, April 27, 2009

Economic Contraction to Slow, Roubini Says (Correct)

By James Kraus

(Corrects to last name in headline)

April 27 (Bloomberg) -- The U.S. economic contraction will slow from 6 percent in the last two quarters to 2 percent by the fourth quarter, economist Nouriel Roubini said in an interview with the Washington Post and Newsweek.

Growth will reach 0.5 percent next year rather than the 2 percent anticipated by most economists, and unemployment will be well above 11 percent, Roubini added.

The end of the contraction probably still won't be felt until the beginning or middle of 2010, Roubini estimated. The European and Japanese economies will remain in recession until the end of next year, Roubini said.

The U.S. is in the midst of a U-shaped rather than L-shaped recession thanks to government intervention, which may need to be extended to a temporary takeover of banks because of the large amount of problem assets, the economist added.
Last Updated: April 27, 2009 04:46 EDT

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