Citigroup Downgrades Global GDP Growth for 2011 & 2012

Citigroup is downgrading the global growth targets for 2011 and 2012.  The economic team there now sees the global growth  Citigroup cut its 2011 global GDP growth forecast to 3.1% from a prior rate of 3.4%.  More importantly, it is cutting the global GDP growth for 2012 down to 3.2% from 3.7%.

This might not seem like much of a cut and might not sound recessionary.  Technically it is not, but it just shows that maturing scale of the economy as China and India are still putting on the brakes, as Europe burns, and as the United States struggles in a quagmire of uncertainty fiscally and politically.

Citi even noted that the global economic prospects continue to worsen markedly and it points to the advanced
economies there.  The sharpest cuts were in the United States, United Kingdon, and Eurozone.  The cuts were more modest in the growth nations of China and India.

Citi went on to note that global GDP growth in the major advanced economies has been below average now for three quarters.  The good news is that no formal recession is called for, but the bad news is tha this sluggish growth is expected to remain as balance sheets remain weak (even though U.S. balance sheets are strong) and as the economic financial conditions tighten.

Another day, another prediction of a dollar less.

JON C. OGG