OECD: Fiscal-cliff failure could trigger recession

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Nov. 27, 2012, 5:54 a.m. EST

http://www.marketwatch.com/story/oecd-fiscal-cliff-failure-could-trigger-recession-2012-11-27

 

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By Barbara Kollmeyer

MADRID (MarketWatch) -- The Organization for Economic Cooperation and Development on Tuesday warned of a "hesitant and uneven recovery over the coming two years," saying it expects global growth of 1.4% this year and next. "The world economy is far from being out of the woods," said OECD Secretary-General Angel Gurría, in a press release as the group released its Economic Outlook. "The U.S. 'fiscal cliff,' if it materializes, could tip an already weak economy into recession, while failure to solve the euro-area crisis could lead to a major financial shock and global downturn." Gross domestic product across the OECD could rise to 2.3% for 2014, according to the projections. For the U.S., it sees GDP of 2% in 2013 if the U.S. can avoid the fiscal cliff, rising to 2.8% in 2014. The euro area is expected to remain in recession until early 2013, leading to a mild contraction of 0.1% next year, before a pickup in growth to 1.3% in 2014.