Saturday, June 14, 2008
Fri Jun 13, 4:38 PM ET
MEXICO CITY (AFP) - he sees a reduced possibility of a deep recession in the United States.told the Latin American Economic Forum here Friday that
There is now a "reduced possibility" of a deep recession, the former Fed oracle said, after telling the Financial Times late last month that a US recession remained a probability.
Greenspan told the paper he believed "there is a greater than 50 percent probability of recession," noting, however, that "that probability has receded a little."
He also told the paper that the likelihood of a severe recession had "come down markedly" but added it was too soon to tell whether the worst was already over.
The US economy grew at an annual 0.9 percent pace in the first quarter of the year, the government said in late May, in an upward revision that calmed the nerves of some economists.
The Commerce Department initially pegged first-quarter gross domestic product (GDP) growth at 0.6 percent, the same lackluster pace as the 2007 fourth quarter.
The revision, in line with expectations, bolsters the stance of some economists who believe the world's largest economy will avoid a recession despite a deep housing slump, a related credit crunch and soaring oil prices.
A recession, which last hit the US in 2001, is typically defined as two straight periods of negative economic activity. Thehas been trying to avert an economic slump by aggressively slashing interest rates.