Monday, August 3, 2009
The United States, Europe and Japan still face the possibility of a double-dip recession and at the very least will experience below-potential economic growth for the next couple of years, economist Nouriel Roubini told CNBC Monday.
By contrast, China and India have the best chance of leading the recovery, Roubini said.
The double-dip is still possible because of very large budget deficits that are being monetized by monetary-policy authorities, Roubini, co-founder and chairman of RGE Monitor, said, speaking at the Diggers and Dealers mining conference in Kalgoorlie, Australia.
If central banks continue to monetize the deficits, “long-term bond yields may go higher, and they may crowd out the economic recovery leading to a double dip,” he said.