When the U.S. coughs, the whole world still catches cold: IMF

"No one is exempt from a global slowdown. That is why you call it global," International Monetary Fund chief economist Simon Johnson said on Tuesday as he updated the IMF's World Economic Outlook.

"It will be very hard for even the most effective counter-cyclical policy to keep any country from having some slowdown in these circumstances," he said.

The IMF has trimmed its estimate for world growth this year to 4.1 percent from its prior outlook of 4.4 percent, with still-resilient emerging economies seen growing at a rate of 6.9 percent from 7.8 percent last year. Even growth in China will moderate from a thumping 11.4 percent in 2007 to 10 percent.

"There are obviously linkages. I think that reports of decoupling have been greatly exaggerated. It is a question of what kind of linkages," Johnson told a media briefing.

Estimating the extent of the fallout will depend on a judgment of the strength of these ties to the U.S. economy, and whether policy-makers in other countries are able to take action to mute the impact.

"It is going to be a story of how are you linked to the U.S. and to what extent can your policy deal with the repercussions," said Johnson.

"To what extent...are you constrained by your domestic inflation in terms of having an appropriate counter-cyclical policy," he added.

The Bank of England has already cut interest rates and may ease again, while the European Central Bank has kept interest rates on hold, citing inflation concern.

World stock markets have swung wildly since problems in the U.S. subprime mortgage market surfaced in August, sparking a global credit crunch that has yet to fully abate. Investors have bet heavily that the United States will tip into recession and drag other economies in its wake.

Johnson ducked the question of an outright recession, but made plain that no economy would entirely dodge the bullet from a slowdown.

"There are some financial linkages, and that is what has brought in Europe. There are some trade linkages, and that is what is bringing in Latin America and it is bringing in Asia, and that is what could spill over to Africa," he said.