The U.S. economy is in recession, albeit a mild one, as a weakening consumer sector has compounded the ongoing problems in the housing and credit markets, according to UBS economists.
"It's not coming, it's here," UBS said in a research report Wednesday.
UBS economists forecast U.S. gross domestic product to fall 0.60 percentage point from the end of 2007 to the middle of 2008.
Last month, the government said the economy grew at an annual rate of 0.4 percent in the fourth quarter of 2007 and expanded 2.2 percent for the entire year, the weakest pace in five years.
The projected mild contraction will be led by the first decline in personal spending since the recession of 1991, UBS said.