The International Monetary Fund (IMF) said on Monday the U.S. economy would contract 2.5 percent this year, with a solid recovery projected to emerge only mid-2010.

In its annual consultation with the United States, the IMF said the U.S. GDP is expected to shrink at a modest 0.75 percent in 2010, compared with the previous estimate of 2.8 percent this year and zero growth next year.

"The staff's outlook remains for a gradual recovery, consistent with past international experience of the financial and housing market crisis," the report said.

"The combination of financial strains and ongoing adjustments in the housing and labor markets is expected to restrain growth for some time, with a solid recovery projected to emerge only in mid-2010," it said.

(Xinhua News Agency June 16, 2009)