Japan and South Korea struggled to revive economies hit by collapsing exports, Russian unemployment soared and Britain's budget deficit reached a record high as the financial crisis deepened across the world.
With the rich world mired in recession, emerging economies such as China, the engine of world growth in recent years, also gave fresh evidence of how deep the problems run.
A Chinese central bank official said cutting interest rates further would be risky and might not help the economy.
The Bank of Japan kept its key interest rate unchanged at 0.1 percent but extended a scheme to buy commercial paper to improve corporate funding and pledged to boost low cost funding.
"The significance is also on what the BOJ decided not to do, such as reverting to quantitative easing or boosting outright government bond purchases," said Hiroyuki Nakai, Executive Director at Tokai Tokyo Research Centre.
"The economy is worsening rapidly and is in a severe state," the government said in its report for February.
The world's second-biggest economy has been hard hit by the crisis and analysts see more pain ahead due to its heavy dependence on exports and weak domestic consumption.
South Korea moved to calm fears its banks might fall under the weight of foreign debts — the latest credit worry to rattle emerging markets after euro zone banks were hit by concern over their exposure to faltering East European economies.
South Korea said its banks' foreign debt burden was small compared with its $200 billion-plus in currency reserves.
But the won weakened for the eighth session running, as investors remained unconvinced.
President Barack Obama on Wednesday presented the latest thrust of his plan to pull the United States out of recession, pledging up to $275 billion to help stem home foreclosures and keep as many as 9 million struggling families in their homes.
World stocks rose from Wednesday's three-month low and the dollar and government bonds fell while oil prices rose.
EXHAUSTION
"Another day, another initiative," broker Calyon said of Obama's housing plan in a note to clients. "Markets are becoming a bit exhausted at trying to discern the impact of whatever the latest announcement, policy or programme might be."
A Reuters survey of around 250 economists across the U.S., Japan, the euro area and Britain showed a deeper contraction than had been expected during the current quarter, a weaker recovery into 2010 and unemployment rates steadily rising.
About 300,000 Russians lost their jobs in January, taking the total number of unemployed to 6.1 million, close to rates not seen since the socially unstable 1990s.
The government forecasts the economy will contract by 2.2 percent in 2009, as falling oil and commodity prices lead a retreat from a decade of high growth. January capital investment fell 15 percent year-on-year, much worse than expected.
Falling tax receipts drove Britain's budget deficit for the financial year so far to a record high in January and statisticians warned bank bailouts could raise total debt by up to 1.5 trillion pounds, or 100 percent of GDP.
In Germany, a survey showed business expectations at their lowest for 32 years.
Asian countries' manufacturing exports have declined dramatically as world trade has slowed. Fears are running high that trade protectionism and economic nationalism will emerge, threatening to deepen the slump.
Obama is expected to try to allay fears about U.S. protectionism when he makes his first foreign trip as president on Thursday, to Canada.
Canadian Prime Minister Stephen Harper will seek assurances the "Buy American" clause in the $787 billion U.S. recovery plan signed by Obama this week will not hit firms in Canada, which sends 75 percent of its exports to the United States.
The clause requires that projects funded by the package use only iron, steel and other goods made in the United States.
FINANCIAL PROTECTIONISM?
The head of Hong Kong's central bank Joseph Yam on Thursday warned of the risk too of "financial protectionism", or the curbing by governments of financial institutions' ability to lend overseas, saying it could have "catastrophic" consequences.
"Unlike trade protectionism, financial protectionism can spread quickly, possibly leading to a sharp reversal of capital flows, with destabilising consequences for monetary and financial stability," he said.
The head of the Chinese central bank's research department, Zhang Jianhua, said in a speech at a financial forum restructuring the world's third-biggest economy was more important than cutting interest rates.
"The money would not enter the real economy," said Zhang. "Of course, there is still room to cut rates, but that option is definitely not the best."
