Europe poised to cut rates as global slump deepens

(Agencies)
Updated: 2008-12-04 16:37

Miserable Consumption 

"With the decline in capital spending this big, it's likely that third-quarter gross domestic product will be revised down," said Kyohei Morita, chief economist with Barclays Capital.

A man displays a banner which reads "All kind of imported bags for sale at 180 pesos ($3.6)" at a makeshift stall in Quiapo, Manila November 27, 2008. [Agencies]

"There's a growing chance that Japan's economy will remain in recession until the second quarter of next year."

The Japanese capital spending numbers were just the latest in a string weak economic data.

Figures from the Australian Federal Chamber of Automotive Industries showed vehicle sales fell 22.2 percent in November, pointing to a miserable fourth quarter for consumption which could well tip the economy into recession.

The Fed's Beige Book, an anecdotal summary of economic conditions, showed the economy, formally declared to have been in recession since December 2007, had deteriorated in recent weeks.

ADP Employer Services said US private employers shed 250,000 jobs in November, suggesting Friday's more comprehensive government report could show job losses topping 300,000, the highest since the aftermath of the September 11, 2001 attacks.

Recession in its major export markets formed the backdrop of the China's "Strategic Economic Dialogue" that began on Thursday with a US delegation including Treasury Secretary Henry Paulson.

China's Vice-Premier Wang Qishan said restoring confidence and avoiding a global financial meltdown must be the priority for policymakers.

"I hope the United States will take all necessary measures to stabilise its economy and financial markets as soon as possible and to ensure the security of Chinese investments and interests in the United States," he said.

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