International: A Road to Recovery

The deepest recession of the postwar period, experienced by virtually all countries around the world in 1974 and 1975, abated during 1976. The recovery began in late 1975 and continued throughout 1976. However, the momentum of the recovery, which appeared strong in the first part of the year, slowed considerably in the latter part. Economic growth, as measured by the expansion in the gross national product (GNP) and corrected for changes in prices in the world's 24 major industrial countries comprising the membership of the Organization for Economic Cooperation and Development (OECD), slowed from around a 6 percent annual rate during the first six months to about 3 percent during the balance of 1976. The slower rate of growth in the latter part of the year seriously impeded these countries' efforts to reduce unemployment, which in most countries had been hovering around postwar peaks. At the same time, however, the rapid rate of inflation that plagued the world economy in the past several years moderated considerably during 1976, as the rate of increase in the consumer prices slowed from well over 13 percent, experienced in the 24 major industrial countries during 1974, to just below 8 percent in 1976.