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US economic recovery 'shaky': Swan


Federal Treasurer Wayne Swan will meet his US counterpart Treasury Secretary Timothy Geithner this week for a "first-hand assessment" of the state of the American economy.

Mr Swan met with G20 finance ministers this weekend in Mexico, where discussions centred on Europe and the US.

The treasurer will be in Washington this week for talks with US Federal Reserve chairman Ben Bernanke, International Monetary Fund (IMF) managing director Christine Lagarde and Mr Geithner.

In his weekly economic note, Mr Swan warned that international economic events could quickly spill across borders.

"Flows of capital can surge or dry up almost overnight," he said on Sunday.

"Business and consumer confidence in one place can sway sentiment in another."

Despite some encouraging data in recent weeks, economic recovery in the US was still shaky, he said.

The looming "fiscal cliff" in the US, which will see a sudden unwinding of tax cuts and the ending of expenditure programs, also risked crippling the world's biggest economy, Mr Swan said.