Economic recovery on track, but risks remain: OECD

OTTAWA — Canada’s economy is increasingly being caught in the tail winds of the downward global spiral, but some of the country’s problems are also homegrown. The Bank of Canada says low interest policies that it and other central banks have put in place are adding another layer of risk to the already stressed global financial system. The Canadian central bank says near record level interest rates that have been in place since the 2008-09 recession are taking their toll on insurance companies, pension funds.

Article written by Prieur du Plessis, editor of the Investment Postcards from Cape Town blog.This post is a guest contribution by Takehiro Sato and Takeshi Yamaguchi of of Morgan Stanley.

Japan's CPI falls 0.9 percent in March as deflation drags on; central bank keeps policy intact TOKYO (AP) — Japan's consumer price index fell 0.9 percent in March from a year earlier, underlining the challenge of ending a long spell of debilitating deflation despite an onslaught of monetary easing and stimulus spending.

The risk of a new major (global) contraction cannot be ruled out OTTAWA — With global conditions weakening, Canada’s economy will remain in the slow growth lane until the middle of next year, the Organization for Economic Co-operation and Development predicts in a new forecast. The OECD projects Canada’s economy will grow by 1.5% in the final three months of this year, and advance only 1.8% in 2013.

Stagflation is lurking and Japan is set for recession this year despite moderate overall recovery, the OECD, warning against complacency.

TOKYO (Reuters) - The doubling of the International Monetary Fund's firepower, an increase in Europe's bailout fund and liquidity injections should be enough to contain Europe's sovereign debt crisis, the head of the Organisation for Economic Cooperation and Development said on Wednesday. European officials need to boost economic growth with deregulation, education and environment-friendly technology, because there's little room to maneuver with fiscal policy and monetary policy, said OECD Secretary-General Angel Gurria. ...