New Delhi: Boosted by good growth in India and China, the world economy is starting to recover from the one of the worst financial crisis in decades, says Moody's.
Despite the global slowdown, two of the world's fastest growing economies, India and China, have witnessed growth.
For the April-June quarter, the Chinese GDP expanded by 7.9 per cent while that of India grew 6.1 per cent.
"The world economy is starting to recover thanks to renewed growth in China and India," Moodys' Economy.com, which is part of Moody's, said in a report.
The US economy mired in recession since December 2007, is seeing signs of recovery and in the second quarter of this year, its GDP shrank much less than expected at 1 per cent.
Apart from Asia, economies in the European, North American and Latin American regions are also bottoming out.
"For now, though, the main story of recovery is in Asia, where China seems to have recovered from its hiccup in the early part of the year, thanks to a vigorous fiscal policy response, and seems like it may regain its pre-recession growth rate.
"India is a similar story," the report said.
Earlier today, Moody's Economy.com revised India's growth forecast to 6.4 per cent for the current fiscal from 6.2 per cent.
Spurring hopes of an early recovery, European economic giants -- Germany and France -- have moved out of recession and posted marginal growth of 0.3 per cent in the second quarter of 2009.
Noting that recovery would be gradual for most countries other than China, the report said the global GDP would expand next year.
"The world economy will grow slowly in 2010 and gather speed in 2011, and most economies will not regain their pre-recession levels of employment and output until the end of 2012," Andres Carbacho-Burgos, who is an economist with Moody s Economy.com, said.
According to the report, the risks to the global economy are to the "downside" and is mainly related to the fragile financial system.
Even though, the financial systems in the US and Europe are regaining health, the report said they are still vulnerable to badly performing assets.
"Continued loose monetary policy and fiscal stimulus measures will be necessary in Europe to minimise the risk of a double-dip recession," it noted.
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