No US economic recovery this year: IMF chief

Author lbostgadmin | Posted on May 3, 2008 | World

WASHINGTON, May 2, 2008 (AFP) – International Monetary Fund chief Dominique Strauss-Kahn said Friday that he does not see the US economy recovering from its current doldrums this year.
Describing a US government labor report Friday that showed fewer than expected job losses as a “flash in the pan,” the IMF managing director said “the medium-term trend remains what has been forecast and the US economy would not be on the road to recovery before the end of the year.
”

The IMF has forecast a “mild recession” in the United States, with annual growth a paltry 0.5 percent.

Strauss-Kahn, speaking to reporters after meeting with French Prime Minister Francois Fillon at IMF headquarters, cautioned that “one must wait to see the next US data.
”

The US Labor Department reported US employers cut 20,000 nonfarm jobs in April, far fewer than private economists’ forecasts of 75,000.

The jobless rate fell a tenth of a percentage point to 5.
0 percent, the department said, instead of the expected rise to 5.2 percent.

While still a weak number, it reinforced the view that the US economy is stabilizing and that the Fed may therefore take a pause in its rate-cutting campaign.