Euro debt crisis increase the odds of recession in the United States

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Reserve Bank increases the European debt crisis the chances on a US recession with economic downturn rather than not by early 2012, according to a survey by the San Francisco federal.

It is difficult, to assess the probability of exactly wrote an analysis of the leading us economic indicators suggests a rising probability of a recession of by the end of the year and early next year, researchers at the regional fed Bank Monday. The risk of a recession will disappear after the second half of 2012, they found.

To solve tax problems have new Governments in Greece and Italy, with fresh promise, in the last few days, allayed investor concerns about a short-term debt default in the euro zone, but Europe's debt crisis far from solved. The region their worst hours since the second world war is facing, German Chancellor Angela Merkel said Monday.

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Although domestic threats to economic growth in the United States are limited, a shock from abroad could derail a fragile recovery.

The weak US economy is more than usually vulnerable to turbulence beyond Europe's borders, as the U.S. shows unexpectedly strong effects from Japan's devastating earthquake in March, the researchers said.

"European government bonds default value can the United States back into a recession sink" Travis wrote mountains, early Elias and Oscar Jorda in the latest San Francisco fed economic writing. "However, when we navigate the storm in the second half of 2012, it seems, that risk will rapidly dwindle in 2013."

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The risk assessment, recession is worse than that of many private economists. A November 4 Reuters of primary dealers survey see Wall Street economists one chance, a US recession next year, 30 percent down from 35.5 percent a month earlier.

Last week the Fed warned Deputy President Janet Yellen on the threat of Europe, said Governments must take energetic measures, contain the crisis or risk of serious damage to the United States influential.

Before you on their contribution to the Fed Board in Washington, Yellen led the San Francisco fed.

Her successor, John Williams, will be a major political speech Tuesday.

Copyright 2011 Thomson Reuters.