The US economy will show lower growth in the fourth quarter than the annual rate of 3.1% shown in the third quarter, the US president's chief economic adviser Glenn Hubbard said today.
Hubbard said that the US economy was likely to grow by 3% or more next year.
Hubbard, visiting Paris for a policy meeting at the Organisation for Economic Cooperation and Development, also said that Europe and Japan should encourage growth.
He said prospects for growth in the short term would improve if economic policies around the world were synchronised.
The Bank of Japan had considerable room for manoeuvre for a more expansionist monetary policy in addition to the zero interest rates it was applying, he said.
Hubbard added that the euro zone should be more concerned with growth than with its public deficits, he told a press conference.
He welcomed last week's Federal Reserve interest cut as 'good news' for the US economy, saying the cut would bring forward the timing of a recovery in business investment. But he said the full effects of the cut would not be felt for 12 to 18 months.
But Hubbard urged the world's other economic giants, Japan and Europe, to also take measures to boost growth.
