Outlook for 1998

• • Asian fall-out on Western economies limited, provided no further setbacks

• • World trade to grow by 5.75 per cent and OECD output by 2.6 per cent

• • Japan the main loser with growth almost halved to 1.4 per cent because of Asia effect; a one in five chance of recession

• • US and EU to grow by 2.6 per cent

• • Recovery of smaller Asian economies quicker than anticipated: S.Korea to grow by 2 per cent

• • Fed to hold fire but short rates to rise by half a per cent in core EU

• • Dollar to peak in first quarter but subsequent decline modest

• • OECD inflation to decline, but no threat of deflation