While the growth of the global economy will slow in 2011 there is no danger of a "double-dip" recession, according to PIMCO portfolio manager Paul McCulley.

The world economy was split into three parts - the US, Europe and the emerging markets - with each area growing at a different rates, McCulley told the Morningstar Investment Conference in Sydney yesterday.

"The [global] economy is going to grow, but it is going to be growing at three different speeds. It's not the way I would like to see the world work, but that is what is happening," he said.

According to McCulley, the economic recovery in the US will not be as rosy as it looked in the growth rate for the fourth quarter.

"There is very lukewarm growth in the US, with very low inflation ... but lukewarm is better than no warmth," he said.

This compares to Europe, which McCulley likened to a cold cup of coffee.

"The monetary union in Europe is without political union and without a federal fiscal system ... overall the Eurozone is going to be a really cold cup of coffee, if a coffee at all," he said.

However, on the upside, he said the current Greek financial issues may bring forward discussion of a shared financial system for Europe.

The bright spot in the world's economy currently are the emerging markets, particularly China, which according to McCulley is an "impressive growth story driven by the export model".

Despite this, McCulley said investors needed to be aware of the potential for China and other emerging countries such as Brazil to overheat.

"The risk in the emerging block is that the coffee becomes scolding," he said.