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U.S., Europe will see slower rebound

The world economy will start growing again in 2010 but emerging markets will accelerate at a much faster rate than the U.S and Europe, due in part to continued frugality among Western consumers, a new report says.

Developing countries in Asia and Latin America will account for the majority of global economic growth over the next decade, according to the New York-based research group The Conference Board, which puts out the closely watched Consumer Confidence Index.

While China will be an important part of the unwinding of the crisis, its growth rate may be overtaken by nations such as India as China's export-driven economy matures and shifts toward consumption.

In a new annual forecast, The Conference Board says world gross domestic product, a measure of overall economic performance, will grow 3.5 percent next year and ramp up to more than 4 percent in 2011.

The group predicts global GDP could accelerate to 4.2 percent from 2011 to 2016. That would be just shy of the 4.3 percent growth the global economy averaged from 2000 to 2008, marking an impressive recovery after one of the worst financial meltdowns of the last century.

Europe and Japan are likely to recover slower than the U.S. in the near-term, due to remaining structural problems in their domestic markets and as the dollar's weakness relative to the euro and yen make their exports more expensive.

The U.S. is likely to see growth moderate from historical standards as consumers spend less and save more, a trend already playing out as retailers head into the crucial holiday season. The group said that along with a greater savings rate, a fundamental transformation in demand may take place, as Americans shift toward smaller houses and more durable environmentally friendly goods.

The Conference Board's Consumer Confidence Index, showed only a small uptick from October to November, held down by lingering concern over layoffs. It's an important gauge for the U.S. because consumer spending on goods and services accounts for more than 70 percent of the nation's economic activity.