Feb 10, 2009

economies bleakest since the oil shock of the early 1970s

Picture Source: OECD
The outlook for the world’s developed economies is the bleakest since the oil shock of the early 1970s, an indicator of future activity released by the Organization for Economic Cooperation and Development showed Friday.
Adding to the gloom, the OECD’s leading indicator data suggest that the large developing economies are increasingly being dragged down by the recession in richer nations.
The OECD’s leading indicator for its 30 developed-country members fell again in December, as did the individual indicators for each of the Group of Seven leading industrial nations. The leading indicators for non-members China, India, Russia and Brazil also fell sharply.
“Leading indicators…continue to point to a weakening outlook for all the major seven economies,” The OECD said. “The outlook has significantly deteriorated in the major non-OECD member economies who are now also facing strong slowdowns.”
Important parts of some G-7 economies are already experiencing slowdowns on a scale last seen in the early to mid 1970s, when a surge in oil prices and a shortage of energy led to severe cutbacks in industrial production.