Open

Coming up

Don't miss

Replay


LATEST SHOWS

THE WORLD THIS WEEK

The World This Week - 01 August 2014 (part 2)

Read more

MEDIAWATCH

Coverage of Gaza in the Israeli media

Read more

REPORTERS

1914-1918: The Depths of Hell

Read more

THE WORLD THIS WEEK

The World This Week - 01 August 2014

Read more

THE INTERVIEW

Exclusive: Israel's US ambassador speaks to FRANCE 24

Read more

#THE 51%

World War One: The war that changed women’s lives

Read more

FRANCE IN FOCUS

Ségolène Royal goes for green

Read more

THE OBSERVERS

A look back at some of the Observers' best stories

Read more

DEBATE

Argentina Defaults: Kirchner Cries Foul Over 'Vulture Funds' (part 2)

Read more

  • Hamas denies capturing Israeli soldier as Gaza truce lies in tatters

    Read more

  • Exclusive: Israel's US ambassador speaks to FRANCE 24

    Read more

  • Police 'chokehold' caused NYC death, coroner rules

    Read more

  • French most keen to erase their online footprint, says Google

    Read more

  • Air France ground workers to strike on August 2

    Read more

  • Rogue general denies Islamist seizure of Benghazi

    Read more

  • Ugandan court strikes down anti-gay legislation

    Read more

  • 1914-1918: The Depths of Hell

    Read more

  • Regional summit to tackle deadly Ebola outbreak

    Read more

  • French hospital to open wine bar for terminally ill patients

    Read more

  • Video: Tipping is dying out in French café culture

    Read more

  • €2.5 million in cocaine ‘disappears’ from Paris police HQ

    Read more

  • Appeal court keeps French rogue trader Kerviel in jail

    Read more

  • Interactive: France’s new plan to counter jihadism in Africa

    Read more

  • Ukrainian army suffers losses in separatist attack

    Read more

  • Argentinian markets plummet following default

    Read more

Business

Timothy Geithner sees 'first signs of growth'

Text by NEWS WIRES

Latest update : 2009-09-03

US Treasury chief Timothy Geithner sounded an optimistic note on Wednesday, saying he had seen "the first signs of growth, positive growth, in this country and around the world" in a media briefing.

AFP - The United States is seeing the first signs of growth after a long recession, Treasury chief Timothy Geithner said Wednesday as new data showed the lowest payrolls decline in nearly a year.

The world's largest economy has been in recession since December 2007, saddled by economic contraction for four quarters since July last year.

Geithner gave the clearest indication yet that growth was underway even though most private economists expect an economic expansion in the July to September period after massive government stimulus.

"You have seen now the first signs of growth, positive growth, in this country and around the world," he said in a media briefing ahead of a meeting of the Group of 20 (G20) finance ministers and central bank governors in London at the weekend.

"We have come a very long way but I think we have to be realistic, we have a long way to go still," he cautioned.

The US economy contracted at a slower pace of 1.0 percent in the second quarter after a hefty 6.4 percent decline in the first quarter.

Geithner said effective steps taken by the G20 emerging and developed nations helped kickstart economic recovery following the global slump.

"The force of the powerful response we have put in place here and at the G2O... has been very successful in helping pulling the global economy back from the edge of the abyss," he said.

Even as growth returns in the United States, analysts caution that rising unemployment could dampen consumer spending, which accounts for about two-thirds of economic activity.

Latest data from payrolls firm ADP said Wednesday that the private sector shed 298,000 jobs in August, the smallest number of jobs lost since September 2008.

It was larger than the market's forecast of 250,000 jobs lost but much less than the 360,000 figure in July.

"Employment losses are clearly diminishing," ADP said.

But it cautioned that despite indications that overall economic activity was stabilizing, employment, which usually trails overall economic activity, was still likely to decline for at least several more months, albeit at a diminishing rate.

The ADP figure came ahead of Friday's government August nonfarm payrolls report, seen as one of the best indicators of economic momentum.

Most analysts believe the report should show a smaller loss of 225,000 jobs compared with a 247,000 decline in July and an unemployment rate ticking up to 9.5 percent from a 26-year high of 9.4 percent.

"In absolute terms, and relative to previous cycles, to see payrolls falling at this pace after 20 months of recession is a very grim performance indeed," said Ian Shepherdson, chief US economist with High Frequency Economics.

He forecast the government will announce 250,000 jobs lost in August.

"At this turning point in the economy, we should expect the payroll declines to go up and down," said Joel Naroff, chief economist of Naroff Economic Advisors.

"The key is the trend and that is falling." he said. "Even if the August losses are higher than July's and the unemployment rate jumps, that does not mean the recession is picking back up or the recovery is not going to occur."

President Barack Obama has warned that the jobless rate could soar to about 10 percent by year-end, even with an improving economy.

Date created : 2009-09-03

COMMENT(S)