Israel to go into recession in 2009

Israel will go into recession in 2009, bank of israel on Sunday said. A negative growth rate of -0.2 percent is expected according to the BOI's new assessment. The previous forecast predicted a growth of 1.5%. The bank foresees a slight recession in the first half of 2009, followed by stability and a return to growth in the second half of the year and a return to the country's potential growth rate only by mid-2010. The bank said the forecast was adjusted in light of negative developments in the world economy as well as the Israeli market.

Significant worsening in economic activity and a decline in the forecasts of global growth were among the factors contributing to the BOI's negative forecast. In Israel, the last quarter of 2008, which exhibited a decline in economic activity, a decline in industrial manufacture and export and the costs of Operation Cast Lead were contributing factors.

CLICK FOR MORE

British economy officially in recession

Figures released at the weekend revealed the economy shrank much faster than expected in the December quarter, slowing at the fastest pace since 1980 as the global financial crisis crippled the banking industry.

Gross domestic product fell 1.5 per cent from the previous quarter. Economists had predicted a 1.2 per cent drop. The economy has now shrunk in two quarters, the conventional definition of a recession. The US, Japan, most of continental Europe, parts of Asia and possibly Australia are expected to join Britain in recession this year.

The pound dropped to a new 23-year low against the US dollar. British stocks, particularly the bombed-out banks, fell after the GDP report late on Friday.

Prime Minister Gordon Brown said that the Government was using "every weapon at our disposal" to fight the crisis.

CLICK FOR MORE