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PARIS - The OECD area of leading industrialised economies pulled clear of recession in the third quarter with 0.8-percent growth but British output still shrank, OECD data showed on Monday.
The 30 economies in the Organisation for Economic Cooperation and Development showed growth of 0.8 percent from output in the second quarter when they had scarcely touched the end of recession with zero growth.
The report found that overall in six of the Group of Seven countries, Britain, France, Germany, Italy, Japan and the United States, gross domestic product expanded 0.7 percent from the second quarter, when zero growth was recorded.
There was no official estimate available for the third quarter in Canada, which is also a member of the Group of Seven.
The OECD said that among the six leading industrialised states, there was wide variation in third quarter performances, ranging from growth of 1.2 percent in Japan to a 0.4-percent contraction in Britain.
For Britain, although the situation was improving, the data marked the sixth quarter running of contraction month by month.
The US economy, after shrinking 0.2 percent in the second quarter, expanded 0.9 percent in the July to September period.
The OECD in a twice-yearly assessment of the global economy last week, warned that although China, Asia and the United States were leading the world out of recession, the rebound would likely be "modest," with governments forced to devise measures to wind down huge, debt-aggravating rescue spending.
It was a message echoed in a speech in London on Monday by International Monetary Fund Managing Director Dominique Strauss-Kahn, who warned that the world economy remained "highly vulnerable."
He told the annual meeting of the Confederation of British Industry: "We can say that the recovery has started but everyone understand that it is very fragile and still dependent on policy support."
He said: "The financial conditions have improved but are still far from normal."
A measure of the fragility Strauss-Kahn referred emerged last week in the United States, where the stock market was chilled by data showing a 10.6 percent slide in housing starts in October and a decline of 4.0 percent in permits to build new homes.
Global stock markets rebounded on Monday as the dollar weakened further, sparking a fresh record on the gold market, where the price per ounce jumped to a record 1,166-1,167 dollars. For several weeks, markets have been sending such signals of anxiety that the recovery is unsteady.
Wall Street stocks have undergone a huge, 60-percent rally since March that some analysts anxiously attribute to the availability of easy money from the US Federal Reserve's near-zero interest rates.
That policy, according to some economists, has ignited a massive "carry trade" in which investors borrow at low rates to invest in riskier assets including stocks, commodities and bonds of other countries.
Although the Fed has shown no inclination to lift rates, the weak dollar has prompted growing complaints from around the world about a potential speculative bubble.
Fred Dickson at DA Davidson said that "global concerns continue to rise about an emerging global asset bubble fuelled primarily by the US Federal Reserve's low interest rate policy."
He said that officials in India, South Korea and Indonesia were considering policy moves "to limit the flow of hot speculative money into their stock and real estate markets."
- AFP/ir
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