The Organisation for Economic Cooperation and Development (OECD) and the European Commission are set to cut their growth forecasts for Europe, draft figures showed today.
The figures, given to Reuters by an EU government source, showed the Paris-based organisation projects the 12-member euro zone will grow at 1.9 per cent next year, a sharp downward revision from 2.9 per cent the OECD had forecast in its spring outlook.
The revisions are likely to increase concerns about the fragile global economy raised on Wednesday by an aggressive half-point US Federal Reserve rate cut.
The OECD euro zone growth forecast for this year also has been trimmed to 0.7 per cent from 1.3 per cent with Europe's biggest economy, Germany, seen just narrowly escaping recession with growth of 0.2 per cent.
The OECD has made clear that its outlook report, due November 21st, would be less optimistic than the April report based on hopes for a speedy rebound from the downturn that followed the September 11th attacks on the United States.
The outlooks follow a recent bleak assessment of the world economy by the International Monetary Fund, which notched forecasts lower for both the United States and Europe.