Every Effort Made to Prevent Recession in U.S.: Expert

Business Materials 5 April 2008 11:47 (UTC +04:00)

Azerbaijan, Baku, 4 April / corr. Trend A. Badalova/ The U.S. economy should go through recession by natural way, said Vladimir Osakovski, the economist of UniCreditAton, part of the international UniCredit Group.

According to Osakovski, U.S. has made all efforts to prevent recession.

"The interest rate has been lowered up to 2.25% and a set of measures on tax stimulation has been initiated. Though the further drop in the interest rate is possible, the potential of such monetary stimulation of economy has exhausted. The enormous deficit in the federal budget restricts the possible measures for fiscal stimulation," said the expert to Trend .

In September 2007, the U.S. Federal Reserve System lowered the key interest rate up to 2.25% to assist economy in preventing crisis from influencing mortgage lending. In February, U.S. Congress approved the plan on stimulating economy in the second half of year at $167bln including the repayment of taxes to consumers and tax privileges for the companies.

According to Osakovski, the further development of U.S. economy will depend on only common macroeconomic recurrence.

"There is a need for stabilization of prices in housing market. It will lead to stabilization of financial sector and economy," said expert.

As to the world economy, Osakovski said that it has already begun to adapt to economic recession in U.S. The adaptation requires correction of exchange rates of a number of currencies.

"There is a need for strengthening exchange rates in Chinese People's Republic and Eastern Asia and there is a need for devaluation in some Eastern Europe countries, CIS and other regions," said Osakovski.

UniCreditAton is specialized in providing services to institutional investors in exchange market and large access to the Russian and international trade centers.

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