Massive government and central bank intervention to provide capital, liquidity and guarantees has averted the immediate risk of systemic failure of the financial system. Nevertheless, mistrust remains rife within the banking system and, together with ongoing de-leveraging to repair bank balance sheets, is impairing the flow of credit in many OECD countries. The financial crisis has spread to a wider range of institutions and markets, including emerging economies, which until quite recently seemed to have been relatively unscathed, and there have been huge falls in global financial wealth. The malfunctioning of financial markets will be the key factor weighing on activity going forward. Related to this to some extent, and further acting as a break on growth, will be the ongoing adjustment in housing markets, which is now a feature of almost all OECD countries. Weaker oil and other commodity prices will provide some relief by boosting real household incomes.