The report said automakers are also restarting plants as auto sales have started to recover. US housing activity also has bottomed after three years of decline, although prices remain depressed because of large volumes of distressed sales and unsold properties, it added.

'While the convergence of government stimulus and inventory rebuilding will boost economic performance in the months ahead, US growth through 2010 will do little more than backfill the hole created by the recent steep decline in activity,'' Jestin said.

He said: 'It will take longer to reverse the 22 per cent drop in US household net worth since mid-2007, to revitalize housing and to restructure the financial services and motor vehicle industries.''

According to the report, the European and Japanese economies also are showing signs of turning the corner. With the exception of the UK, they have not suffered the 'seismic shocks that have reverberated through the US financial system', the report said.

But their recent GDP losses won't be recouped until beyond 2010, it said.

However, financial markets will remain volatile during this 'uneven and protracted global convalescence', the report said.