Recession of 2009/Addendum
Jump to navigation
Jump to search
Recent economic developments
2008 4th quarter
World
- G20 leaders agree on need for fiscal stimulus [1]
The United States
- Output falls - gdp falls at an annualised rate of 6.2%
- Unemployment soars - the rate the highest for 14 years - 6.7% in November 2008[2].
- $800 billion support package [5]
- Federal Reserve buys mortgage-backed securities - Bank promises to buy up to $500 billion worth of mortgage-backed securities guarantee by Fannie Mae and Freddie Mac and up to $100billion worth of their direct debt [6].
- Quantitative easing - Fed's open market purchases raise base money (the Bank's balance sheet total) from $0.9 trillion to $2.2 trillion [7]
- Record national debt; - 72.5% of GDP [8]
Europe except UK
- Eurozone output falls - Euro area and EU27 GDP falls by 1.5% [9].
- German output falls - GDP falls by 2.1%.
- French output falls - GDP falls by 1.2%.
The United Kingdom
- Output falls - gdp falls by 1.5% [10].
- National debt reaches 43.6% of GDP [13]
Asia
- Recession in Japan GDP fell 3.3% from Q3 to Q4 2008 [14].
- Australian economy shrinks 0.5% [15]
- Developing countries in recession GDP probably fell by an average annualised rate of around 15% in Hong Kong, Singapore, South Korea and Taiwan [16]
2009, 1st quarter
World
- G7 Finance Ministers endorse fiscal stimulus policy [17]
The United States
- Rising unemployment - 7.6% in January, 8.1% February.
- Record budget deficit - $1.2 trillion 2009 deficit forecast by the Congressional Budget Office [18]. (Government spending expected to rise to 23% of GDP [19])
- Major fiscal stimulus - proposed by President-elect Obama in his speech of 8 January [20][21]
- Congress approves stimulus package - American Recovery and Reinvestment Act(H.R. 1) - a $839 billion stimulus package [22]
- Financial Stability Plan - Government launches a plan intended to restore confidence in the financial system (including mandatory stress tests for major banks) and to provide financial assistance households and businesses[23]
- Fears of Trade War – America First Steel Act, Homeland Security Comm. approves bill requiring federal agencies to use U.S. steel for public works projects, (HR 5935) [24] [25]
Europe excluding UK
- ECB Discount rate cut from 2.4% to 2% [26]
- French industrial production plunges at an annual rate of 13% in January.
- Eastern Europe's economic crisis [27]
United Kingdom
- Discount rate cut - from 2% to 1.0% [28].
- IMF endorses policy IMF Deputy Managing Director says "There is no unique weakness in the UK economy, and we believe the measures taken ...will strengthen the economy over the medium term "[29].
- Asset protection scheme[30]
Asia
- China's falling growth rate [31]
- Japan's exports halved - exports in January 2009 were 56% less than in January 2008 [32].
2009, 2nd quarter
World
- World economy to shrink - according to World Bank report [33]
- Developing countries lose exports [34].
United States
Europe except UK
United Kingdom
- Quantitative easing starts - Bank of England Reduces Bank Rate by 0.5 percentage points to 0.5% and announces £75 Billion Asset Purchase Programme [35].
Asia
- China faces a difficult year[36]
Forecasts and outturns
- Annual percentage growth in Gross Domestic Product
- (forecasts are shown in italics)
Date Source Country 2007 2008 2009 2010 2011 22 December 2008 World Bank [37] United States 2.0 1.4 -0.5 2.0 Japan 2.1 0.5 -0.1 1.5 Euro area 2.6 1.1 -0.6 1.6 China 12 9.4 7.5 8.5 Developing [1] 6.1 5.0 2.9 4.7 World 3.7 2.5 0.9 3.0 28 January 2009 International Monetary Fund [38] United States 2.0 1.1 -1.6 1.6 United Kingdom 3.0 0.7 -2.8 0.2 France 2.2 0.8 -1.9 0.7 Japan 2.4 -0.3 -2.6 0.6 China 13 9 6.7 8 World 5.2 3.4 0.5 3.0 7 March 2009 Economist Poll [39] United States -2.2 1.9 United Kingdom -2.6 0.5 France -1.7 0.7 Germany -2.5 0.8 Japan -3.2 0.8
- ↑ Developing countries except China and India.