Newly-elected president Barack Obama is set to face some tough economic challenges when he takes up residency at the White House.

The Democratic nominee was declared victorious after exceeding the 270 electoral college votes needed to defeat Republican John McCain.

His acceptance speech - in which he insisted a "new dawn of American leadership" was at hand - was met with cheers and rapturous applause.

But economists have warned that once the honeymoon period is over, Obama will come up against some difficult decisions as the US economy heads into recession.

As well as falling economic growth, he will also have to deal with mounting personal debt and home foreclosures, as well as rising unemployment.

Prior to his election, Obama pledged to create millions of jobs through investment in renewable energy and infrastructure improvements.

He also promised to implement a $60 billion stimulus package, part of which would be used to help homeowners struggling with debt to repay their mortgages.

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