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Inflation to cause global recession

(Xinhua)
Updated: 2008-06-13 07:37

NEW YORK -- Slower growth is spreading around the world with inflation being main threat to causing global recession, U.S. Conference Board said here on Thursday.

Vice President and Chief Economist of U.S. Conference Board Bart van Ark told a press briefing that with U.S. consumer confidence hitting the lowest level since 1992, and employment trends index showing no relief in short term, U.S. economy is in a solid slow growth mode, with little perspective to move much in rest of 2008.

Meanwhile, Europe and emerging economies in Asia are also showing significant slowdown in economy growth, he said.

Van Ark pointed out that the main downward risk comes from global inflation. While U.S. and European inflation trends may come down as demand eases, the global trend, in particular for emerging economies remains worrying, he said.

"Even after speculative bubbles burst, inflation rate may not come down to level before the increase," van Ark said. "Demand- supply mismatches will not be easily relaxed, and protectionist backlashes may distort global growth."

Established in 1916, the U.S. Conference Board is the world's preeminent business membership and research organization, best known for its monthly U.S. Consumer Confidence Index and the Leading Economic Indicators.