AS per OECD's new analysis, economic recovery has come very close to a halt in the key industrialised countries, with declining household and business confidence adversely affecting both the global trade and employment.

The Study indicates that economic growth in the G7 economies excluding Japan will remain at an annualised rate of less than 1% in the second half of 2011. Earlier improvements in the labour market are now fading; hiring intentions are softening and there are greater risks that high unemployment could become entrenched, it adds.

On the upside, the Analysis notes that a number of OECD countries have been taking serious fiscal and structural reform measures, which should boost confidence. President Obama's announcement later today is expected to provide a boost to job recovery in the United States.

The OECD recommends that central banks keep policy rates at present levels, and barring signs of recovery, consider lowering rates when there is scope. Other monetary policy responses to the crisis could include further central bank interventions in securities markets, strong commitments to keeping interest rates low over an extended period and the withdrawal of monetary tightening in emerging economies.