The International Monetary Fund has said a sustainable economic recovery in the US is not a foregone conclusion.
In its annual review of the US economy, the IMF said that while recent figures had been reassuring, lingering effects of the collapse of the stock market bubble could still dampen activity.
The fund also raised concerns about the US budget deficit, which have been heightened by the Bush administration's tax cuts.
'Sustained fiscal deficits would eventually crowd out investment and erode productivity growth,' the IMF said.
It described the US economy's performance, however, as 'resilient' after the shocks of September 11, the stock market collapse and corporate scandals.
The fund forecast that GDP growth would rise from 2.5% this year to 3.75% in 2004.
