IMF Says Recession Is Over

From Marketwatch

The global recession is now over and a recovery has begun, Olivier Blanchard, the top economist for the International Monetary Fund, said Tuesday.

The global recession has not been typical, and the recovery won't be either, he said. "One should not expect very high growth rates in the recovery."

"The turnaround will not be simple," Blanchard wrote in an article released by the IMF. "The crisis has left deep scars, which will affect both supply and demand for many years to come." His article will be published by the IMF on Wednesday.

To an economist, the term "recovery" has a specific technical meaning: The economy is growing once again, but has not necessarily returned to its previous levels of output, wealth or employment. The economy is healing, but not yet healed.

Indeed, Blanchard said this recession has been so destructive that "we may not go back to the old growth path ... potential output may be lower than it was before the crisis."

Growth is coming for most countries, for at least the next few quarters, he said, but it won't be strong enough to reduce unemployment for a while.