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OECD warns global economic outlook has darkened

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  • 16/09/2014
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The global economic outlook has darkened in recent months, with a slow recovery in the eurozone holding back many other economies, the Organisation for Economic Co-operation and Development has said.

In its latest update, the group downgraded its growth forecast for most of the world’s largest economies, including the UK.

Conflicts in Ukraine and the Middle East and the referendum on an independent Scotland are areas of risk and uncertainty, it said, as it reduced the growth forecasts for 2014 of nearly all the major economies.

It has lowered its 2014 estimate for the eurozone economy to growth of just 0.8%, compared with a forecast of 1.2% made in May.

Meanwhile, the UK’s forecast was cut by 0.1 percentage points to 3.1%, although it was one of the regions which saw the smallest revisions.

In comparison US economic expansion for 2014 was cut to 2.1% from 2.6%, while Japan’s forecast was cut to 0.9% from 1.2%.

The OECD did not provide an update to its forecast for global growth for 2014, which it forecast at 3.4% in May.

“Continued slow growth in the euro area is the most worrying feature of the projections,” the OECD said.

Elsewhere China – which is not an OECD member – had its 2014 forecast 7.4%. The OECD said China “has so far managed to achieve an orderly growth slowdown to more sustainable rates”.

India was the only economy to be judged by the organisation as likely to grow quicker, with its forecast upgraded to 5.7% from 4.9% after voting in a new government that said it would pursue growth-oriented reforms and progress in containing inflation.

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