Mid last year, official international bodies were generally forecasting that the world economy would grow by around 4 per cent in 2009, only a little below average. Now they are forecasting that global GDP will fall by around 1 per cent in 2009, the weakest outcome in the post-war period.
It is widely accepted that a precondition for economic recovery is the restoration of financial stability. Markets have at times been frustrated at how long it has taken countries with  BIS Review 39/2009  1  banking problems to implement measures to restore the health of their financial institutions.