Friday, June 01, 2007

US economy heading towards a recession?

The American economic growth skidded to a standstill in the first three months of the year as a healthy rise in consumer spending was wiped out by an unexpected cut in the amount of stocks held by business.

The U.S. economy grew at its weakest pace in more than four years during the first quarter, a 0.6 percent growth rate the government reported Thursday, as a cooling housing market, slower consumer spending and a gaping trade deficit eroded economic activity.

The final quarter of last year reported a 2.5 percent growth rate.

Federal Reserve Chairman Ben Bernanke says he doesn't believe the economy will slide into recession this year, nor do Bush administration officials and many economists. But ex-Fed chief Alan Greenspan has put the odds at one in three.

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