Expect Double Dip in Second Quarter: Economist

The U.S. economy will slip back into recession in the second and third quarter of 2010 as the boost from fiscal stimulus measures and inventory rebuilding wears off, James Shugg, senior economist at Westpac Bank, told CNBC Wednesday.

"In the second half of this year, starting in the second quarter, a bit of a mismatch is going to take place," Shugg said.

"You'll see the boost to growth from fiscal stimulus and inventory rebuilding lose momentum and what's left? A consumer that's still inclined to save more than spend, a banking system still dragged down by one in four mortgages being in default," he said.

- Watch the video above to see the full James Shugg interview.

Shugg expects U.S. gross domestic product to remain positive in the fourth quarter of 2009 and the first quarter of 2010 and be between 3 and 4 percent on an annualized basis.

"In the U.S. we haven't yet seen jobs growth take place, in fact we're a little bit skeptical about the (December) U.S. payrolls number because our sense is that most U.S. labor market indicators are pointing to jobs still being shed at a milder pace, but not actually being put on," he added.

He also said that if the employment situation shows improvement in the near term, it will only be short lived.

Many market watchers expect the U.S. economy to have seen the last of the recession despite concerns over the end of stimulus measures and the state of the consumer and banking sector.

"We actually have an above trend growth forecast for the 2010 in the US economy. We're looking at a 3.5 percent growth rate for the US market," Jing Ulrich, managing director & chairman, China equities from JPMorgan Securities, told CNBC.