LONDON — The world's developed countries, hard hit by the financial crisis, have probably tipped into a recession that will last at least through the first half of 2009, according to projections issued Thursday.
The Paris-based Organization for Economic Cooperation and Development forecast that economic output would shrink 1.4% this quarter for the 30 nations that make up its membership -- and keep contracting until the middle of next year.
That would mean the developed world has entered a slump expected to last at least three quarters; two consecutive quarters is a common definition of recession. For all of 2009, these economies are expected to contract 0.3%.
Additionally, the U.S. economy is forecast to fall 2.8% in the fourth quarter, after a 0.3% drop in the third quarter, and then shrink 0.9% in 2009. Japan's economy is expected to shrink by 0.1% next year and the Euro area by 0.5%.