Washington ? Although not firing on all cylinders, the global economy should pick up some steam in 2004, the World Bank said Wednesday.

Concerns persist about budget and trade deficits in the United States, stagnation in Europe and lingering deflation — a destabilizing fall in prices — in Japan, the bank said.

The bank lowered the world’s overall growth prospect for this year to 2 percent from the 2.3 percent forecast in April. It also cut the forecast for 2004 to 3 percent from 3.2 percent.

“The global economy continues to sputter,” according to the bank’s annual “Global Economic Prospects” report.

“Although some signs of turnaround have been evident in the United States, Europe seems to be losing momentum and Japan appears positioned for another disappointing year.”

Gobind Nankani, the bank’s vice president for the poverty reduction and economic management network, said that “global economic prospects are looking somewhat better although there are some uncertainties ahead of us.”

Among those uncertainties are continuing unrest in the Middle East, high oil prices and a steep fall in the value of the dollar.

The report said that although prospects for 2004 were improved, growth would not be strong enough to cut sharply into unemployment rates.

“Structural problems persist — overcapacity in high-tech industries globally, rising twin deficits in the U.S. fiscal and current accounts and lingering bad loans in Japanese and, to a lesser extent, European banks,” the bank said.