The International Monetary Fund (IMF) today added to the growing chorus of concern the US is heading for a full-blown slowdown, stating that the world's largest economy "remains very weak, certainly close to a possible recession."

A leaked draft copy of the IMF's world economic outlook, the agency confirmed US growth would reach 1.5 per cent over 2008.

The forecast, which could still be changed before the report is released in April 9, is in contrast to the Organization for Economic Cooperation and Development (OECD) US gross domestic product (GDP) would grow by 0.1 percent in the first three months of this year, and then slow to zero expansion in the second quarter.

Earlier this week, the IMF said the Federal Reserve’s emergency measures to calm turmoil in the credit market, including a three-quarters of a percentage point cut in interest rates, were “appropriate”.

The IMF's outlook report is expected to confirm global growth at 4.2 per cent in 2008, slightly above the IMF’s last forecast in January of 4.1 per cent but well below its 2007 forcecast of 4.9 per cent.

ANSA, an Italian News Agency, states that the IMF study backs the European Central Bank's (ECB) hardline stance in not cutting interest rates.

It said: “The ECB is rightly holding interest rates stable for now,” adding that the ECB “should be ready to respond in a flexible manner if downward risks to growth and inflation growth intensify.”

IMF First Deputy Managing Director, John Lipsky, has said in recent weeks that growth in the US is sluggish but it is not in recession.

US Treasury Secretary, Henry Paulson, this week described the country’s economy as being in“sharp decline." This is the closest he has come to conceding an election-year recession.

Explore Economics

• Pre-Budget Report 2008

• Budget 2009

• World Economic Forum

• The Times MPC

Times Recommends

• Lies and cover-up at MG Rover exposed by report
• High oil prices push manufacturing costs up
• Primark founder steps down as chief executive