Citigroup sounds the alarm on world economy

Citigroup is sounding the alarm bells for the world economy. In a new analysis, the New York-based bank’s chief economist, Willem Buiter, said there is a 55% chance of some form of global recession in the next couple of years, most likely one of moderate depth and length.

Unlike the US-driven international slumps of the past two decades, this one will be generated by sliding demand from emerging markets, especially China, which has surged in size to become the world’s No 2 economy.

“The world appears to be at material and rising risk of entering a recession, led by EMs and in particular by China,” wrote Mr Buiter, a former UK policy maker.