America catches a cold and everyone else shivers...

The US economy slipped into the early stages of a recession, official figures showed, adding to growing fears of a global recession over the next year.

The figures, however, failed to deter another day of modest recoveries in stock markets and commodity prices around the world – many of which were buoyed by Wednesday's cut in interest rates by the US central bank, the Federal Reserve. 

Economic growth in America fell by 0.3 per cent between June and September – after rising by 2.8 per cent during the previous three months. 

Consumer spending, which makes up two-thirds of the US economy, shrank by 3.1 per cent, the first contraction since 1991. 

The US does not use the common definition of a recession as two quarters of negative GDP growth but relies upon a body called the National Bureau of Economic Research to rule on the extent of any downturn. 

The deteriorating economic situation is having a profound effect on the Presidential race – with John McCain's dwindling popularity in states such as Michigan and Indiana blamed on his lacklustre response to the financial crisis. More...

See also:

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3. Crisis: the man who sleeps in Hotel Honda...
4. Ron Paul: Capitalism without Capital is leading to bankruptcy...