[April 2 (Bloomberg) -- Federal Reserve Chairman Ben S. Bernanke acknowledged for the first time that a U.S. recession is possible because homebuilding, unemployment and consumer spending will deteriorate.
``It now appears likely that real gross domestic product will not grow much, if at all, over the first half of 2008 and could even contract slightly,'' Bernanke said in testimony to Congress's Joint Economic Committee today. He also told lawmakers the Fed's emergency loan to Bear Stearns Cos. followed a March 13 warning by the company it ``would have to file for Chapter 11 bankruptcy the next day.''
While the Fed expects the economy to return to its long-term growth pace in 2009, ``in light of the recent turbulence in financial markets, the uncertainty attending this forecast is quite high and the risks remain to the downside,'' he said.
IMF Cuts Forecast
Separately today, the International Monetary Fund cut its forecast for global growth this year and said there's a 25 percent chance of a world recession, citing the worst financial crisis in the U.S. since the Great Depression. Also, orders to U.S. factories fell more than forecast in February, a Commerce Department report showed.]
Intense.
