The International Monetary Fund warns the global recession will hit deeper and last longer than previously thought, while touching almost every country on Earth.
The IMF's semiannual World Economic Outlook, released Wednesday, says the current recession is the worst "by far" since the Great Depression of the 1930s. It forecast the world economy will shrink by 1.3 percent this year.
The global economy's worst performance in 60 years caught IMF experts by surprise; just three months ago, they predicted slight but positive growth this year. Now the IMF says sluggish growth is not expected until 2010. Chief Economist Olivier Blanchard says that depends on the recovery of a fragile banking system which is still hesitant to lend money to consumers and businesses.
The IMF forecast for the United States, the world's largest economy, is even bleaker. It predicts the U.S. economy will shrink 2.8 percent this year and will not see any growth in 2010.