Finance & Business World

Countries need to maintain stimulus programs to help support their economies because a further deterioration of the U.S. housing market and volatile oil prices pose risks to the global recovery, OECD Secretary-General Angel Gurria said.

“It’s very early to stop the stimulus,” the Organization for Economic Cooperation and Development’s Gurria said in an interview with Bloomberg yesterday in Busan, South Korea. The key “question will be when to move from policy-based recovery to self-sustained growth.”

The OECD in September predicted a “modest” recovery for the world’s leading industrialized economies, saying the Group of Seven nations will shrink 3.7 percent this year, rather than the 4.1 percent projected in June. The organization has also said weakness in corporate profits, hiring, incomes and housing markets would slow the subsequent rebound payday advance lender.

“There still are a number of downside risks” to growth, Gurria said in the interview. These include volatility in oil prices, “which can affect some other types of prices, including the price of food.” Governments are still to finish the recapitalization of banks, which “have not yet restarted lending at the natural pace,” he said.

The credit-market meltdown that led to a financial crisis has caused more than $1.6 trillion in losses and writedowns worldwide.

European Central Bank governing council member Christian Noyer said earlier this week banks need to shore up their capital base, recommending restraint in dividend distributions and compensation.

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