Home > Uncategorized > IMF: U.S. Recovery ‘Remains Tepid’ Due to Euro Crisis, U.S. Politics

IMF: U.S. Recovery ‘Remains Tepid’ Due to Euro Crisis, U.S. Politics

24/7 Wall St.

The International Monetary Fund warned Tuesday that the U.S. recovery is still on shaky footing, and  political action must be taken to keep economic growth stable.

“The U.S. recovery remains tepid and subject to elevated downside risks, in light of financial strains in the euro area and uncertainty over domestic fiscal plans,”the report by the IMF says. “Against this background, policies need to decisively tackle medium-term challenges while using the available room to support the recovery.”

The IMF believes that growth will remain “modest” in the next two years, “constrained by household deleveraging, fiscal restraint, and subpar global demand.” Real GDP growth is expected to grow 2% in 2012 and 2.3% in 2013. Previously, the IMF GDP projected growth of 2.1% in 2012 and 2.4% in 2013.

There are two major risks to growth, according to the IMF. Lingering effects of the European debt crisis could impact the U.S. The other major concern is a political stalemate in Congress on the…

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