Gurria slashes OECD economy forecast to -4.2% in 2009

PARIS (Reuters) - The Organisation for Economic Co-Operation and Development (OECD) will slash its 2009 forecast next week to show the 30-nation bloc's economy shrinking by 4.2 percent, General Secretary Angel Gurria said on Friday.

Economies around the globe would experience a "terrible" year and data that had emerged of late had gone from bad to worse, said Gurria, joining the ranks of organisations that have hacked away at forecasts as the economic crisis has deepened. The OECD earlier forecast a 0.4 percent contraction.

The Paris-based OECD, which is funded by 30 countries including the United States, Japan and the rich industrialised nations of Europe, last issued economic forecasts in November and is due to publish its revised outlook on Tuesday.

"We know the numbers are going to be looking worse and worse every day, every time we measure. And we know it is going to be a terrible year," Gurria told reporters.

"What we should not do is act like we've been surprised, taken aback by the news ... every week, when a new piece of information comes out confirming what we know is going to happen," he said.

The economic crisis, which began as a financial crisis and was now seriously affecting jobs, was hitting regions as far afield as Africa and Latin America irrespective of the soundness of domestic policies, he said.

In a wide-ranging discussion ahead of a summit of leaders of the Group of 20 old and new powers on April 2, Gurria also touched on the theme of the status of the U.S. dollar, whose status as the world's reserve currency has been questioned.

"The dollar, as is usually the case, will have its ups and downs but it will continue to be the reserve currency par excellence," he said.

(Reporting by Tamora Vidaillet; Editing by Ruth Pitchford)