After a long drought of positive economic news, it has been hard for commentators to contain their glee at recent signs of a revival.

A rebound in the US after the Iraq war now appears to have vindicated the optimists. The US recovery could gather pace over coming months as companies that cut stocks to the bone in the uncertain period around the war order new inventories.

Best of all, the rest of the world seems to be sharing in the good fortune.

There are tentative signs of improvement in the euro zone, with economists encouraged by rising business confidence and a growing willingness by policymakers to engage in structural reform. In Japan, the economy grew by a surprisingly strong 2.3 per cent annualised in the second quarter.

Yet many global economists argue that, after an initial spurt, growth could continue to be sluggish.

"People want to believe but it remains hard to make a convincing case that there will be really robust growth over the next few years," says Mr Paul Mortimer Lee, global economist at BNP Paribas.

The fundamental problem remains the legacy of the boom years, which is most evident in the US.

Over-investment during the late 1990s significantly raised the capacity of US businesses. As demand has slackened, the result has been a large output gap - the difference between actual and potential production. As a result, the US should be able to grow as fast as 4 per cent for more than two years before the downward pressure on inflation starts to abate.

This helps explain why the recovery in corporate profits has not yet led companies to expand their workforces. Two years after the 2001 recession, US private sector employment has fallen by more than 2.5 million. The unemployment rate, at 6.2 per cent, is about 2 percentage points higher.

US households have their own excesses to work off. Americans are still saving just 3.3 per cent of their disposable income - much less than the historic average of 6-10 per cent. Without a relatively swift recovery in employment, US households may be tempted to step up savings.

If the US falters, it looks likely that Japan will too. There are signs that Japanese domestic consumption has been picking up. The household savings rate is down to 6 per cent, versus 16 per cent in 1989, and deflation shows evidence of abating. But the second-quarter growth figures showed that the exporters remain by far the most dynamic element of the economy - representing one-third of total growth.

Nor is the euro zone seen as a potential stand-in as global leader if the US disappoints. Euro-zone growth is thought unlikely to exceed 2 per cent next year.

The worry is not just that US growth might flag. If the US continues to grow faster than the rest of the world, the ballooning US current account deficit should widen further.

The US current account deficit is expected to reach about $623 billion (€551 billion) in 2004 - requiring the US to attract around a net $2.4 billion of overseas capital every working day. While this need not be a problem while the world is hungry for US assets, there are signs that private sector demand is weakening.

The message from economists is that, until past excesses are worked off, global growth may fail to live up to the elevated standard of the 1990s.