Fears of another recession in the U.S. in 2012 made headlines as early as last year after several economists predicted a further deepening of the economic downturn in the world's largest economy in the first half of the year.
The last time the U.S. fell into a recession was from December 2007 to June 2009 during the global financial crisis. An economic recovery has been shaky since a turnaround in 2010, when gross domestic product (GDP) grew by 2.4 percent. In 2011, GDP growth fell to 1.8 percent, raising fears of a double-dip recession this year.
In October last year, notable economist Nouriel Roubini, who correctly predicted the 2008 financial crisis, told CNBC that the U.S. economy, along with the euro zone and U.K., were headed for a second recession within the first two quarters of 2012. Those fears were further strengthened this year when former U.S. President Bill Clinton said in June that the U.S. was already in a recession.
But we are at the end of the year, and the U.S. economy has held up. Last month third quarter growth figures were revised up to show that the economy grew at 2.7 percent, best since the fourth quarter of 2011. Despite weakness in the labor market, the U.S. economy is still on track to clock a growth rate of about 2 percent this year. However, the new year could pose a fresh challenge. The economy faces another threat of recession if the so-called "fiscal cliff" - a series of tax hikes and spending cuts that will come in to effect on Jan. 1 - is not avoided.