The Organization for Economic Co-operation and Development (OECD), based in Paris, has released its latest global economic outlook, predicting growth of 3.1 percent this year and 3.2 percent in 2025. The upgrade in the forecast is due to stronger-than-expected growth in both the United States and China, despite modest overall growth rates.
The OECD noted that inflation has fallen faster than initially projected, while private sector confidence has improved. Recovery rates have varied among countries, with softer outcomes seen in Europe and low-income countries, while the United States and many large emerging-market economies experienced strong growth.
According to the OECD’s projections, the US economy is expected to grow by 2.6 percent this year and 1.8 percent in 2025, while China, the second-largest economy in the world, is projected to expand by 4.9 percent in 2024 and 4.5 percent next year. The eurozone is anticipated to see growth of 0.7 percent this year and 1.5 percent in 2025.
However, the outlook for the United Kingdom has been downgraded, with growth expected to reach only 0.4 percent this year and 1 percent in 2025. The OECD highlighted ongoing uncertainty in the global outlook due to geopolitical tensions in the Middle East that could potentially disrupt energy and financial markets as a major risk factor for future economic stability.
Despite these risks, however, the OECD believes that overall economic conditions are becoming more balanced as we progress through the year towards a brighter future for global economies.
In summary, while there are still challenges ahead for global economies such as geopolitical tensions that could disrupt energy markets and financial markets but overall global economic conditions are improving with stronger than expected growth rates especially from USA & China which will positively affect other economies around it including Europe and emerging market economies