Please use symbol entry at top right of page to search

Any U.S. recession would likely be short, shallow, IMF official says

WASHINGTON (Reuters) - If the United States does fall into a recession, it would likely be "relatively short," with only modest increases in unemployment, and may look like U.S. downturns in the early 2000s, an International Monetary Fund official said on Friday.

Nigel Chalk, deputy director of the IMF's Western Hemisphere Department, said the depth of any recession would depend on the size of the shock that would push the U.S. economy off its IMF-predicted path of narrowly avoiding recession, and strong household balance sheets would provide a cushion.

"There's a lot of savings sitting in the system that would help support demand, and the labor market is historically tight," Chalk said at a news conference on the IMF's review of U.S. economic policies. "And since all of those things would help support the economy, so if it was hit by negative shock, it should pass relatively quickly and have a relatively quick recovery afterwards."

(Reporting by David Lawder; editing by Jonathan Oatis)

Copyright © Reuters 2008. All rights reserved. Republication or redistribution of Reuters content, including by caching, framing or similar means, is expressly prohibited without the prior written consent of Reuters. Reuters and the Reuters sphere logo are registered trademarks and trademarks of the Reuters group of companies around the world.

News, commentary and research reports are from third-party sources unaffiliated with Fidelity. Fidelity does not endorse or adopt their content. Fidelity makes no guarantees that information supplied is accurate, complete, or timely, and does not provide any warranties regarding results obtained from their use.