US investment bank Citigroup cut its growth forecasts for the world economy on Thursday, and said that risks of a global recession were increasing.

Citi cut its forecasts for global economic growth for 2016 to 2.7 per cent from 2.8 per cent, citing pressures from disinflation.

“Risks to our growth forecasts probably remain to the downside, with increasing risks of global recession,” Willem Buiter, global chief economist at Citi, wrote in a research note.

World stock markets have slumped since the start of 2016, as a slide in the price of oil has rattled investors and raised concerns about a slowdown in the global economy.

Reuters