OECD raises global growth outlook as US and China exceed expectations | Business and Economy

The Paris-based organization expects the global economy to expand by 3.1% this year and 3.2% in 2025.

The Organization for Economic Co-operation and Development (OECD) improved its outlook for the global economy, supported by stronger-than-expected growth in the United States and China.

The global economy is expected to grow 3.1% this year and 3.2% in 2025, the Paris-based organization said on Thursday.

The revised outlook compares with February projections of 2.9% in 2024 and 3% next year.

“There are some signs that the global outlook has started to improve, although growth remains modest. The impact of tighter monetary conditions continues, especially on the housing and credit markets, but global activity is proving relatively resilient, inflation is falling faster than initially projected, and private sector confidence is now rising. improve,” said the intergovernmental organization.

The OECD said the pace of recovery diverged widely across countries, “with softer results in Europe and most low-income countries, offset by strong growth in the United States and many large emerging market economies.”

Among major economies, the US is forecast to grow 2.6% this year and 1.8% in 2025, up from 2.1% and 1.7%, respectively.

China, the world’s second-largest economy, was expected to expand by 4.9% in 2024 and 4.5% next year, compared with 4.7% and 4.2%, respectively.

The euro zone was expected to achieve growth of 0.7% this year and 1.5% in 2025, an increase from 0.6% and 1.3%, respectively.

The outlook for the UK has been downgraded, with growth forecast to reach 0.4 percent this year and 1 percent in 2025, a fall of 0.3 percent and 0.2 percent respectively.

The OECD said “substantial uncertainty” continues to cloud the global outlook, including tensions in the Middle East, although risks are becoming “more balanced”.

“Heightened geopolitical tensions remain a significant downside risk in the near term, especially if evolving conflicts in the Middle East intensify and disrupt energy and financial markets, increasing inflation and reducing growth,” he said.