OECD Reports Global Growth Outlook to Decelerate in 2025, 2026
(MENAFN) The Organization for Economic Cooperation and Development (OECD) reported on Tuesday that global GDP growth is set to decelerate from 3.3 percent in 2024 to 2.9 percent this year and in 2026.
In its newest Economic Outlook, the OECD downgraded the global growth projections, factoring in a technical assumption that current tariff rates as of mid-May will remain unchanged despite ongoing legal battles.
The organization cautioned that persistent negative trends—including escalating trade barriers, tightening financial conditions, weakening business and consumer confidence, and heightened policy uncertainty—could severely threaten global economic prospects.
For the United States, the OECD forecasts a sharp slowdown, with growth slipping to 1.6 percent in 2025 and further down to 1.5 percent in 2026.
It pointed to recent weak data signals, such as consumer and business sentiment surveys along with inflation expectations, which suggest a significant cooling in U.S. real GDP growth.
The eurozone is expected to grow by 1 percent in 2025 and 1.2 percent in 2026, maintaining previous forecasts as foreign demand slowly rebounds. The outlook for the region benefits from improved financial conditions and lower energy costs, the OECD added.
Germany’s economy within the bloc is projected to grow modestly by 0.4 percent in 2025 and strengthen to 1.2 percent in 2026.
"The recovery will be driven by domestic demand," the organization noted, emphasizing that private consumption will rise thanks to low inflation, increasing nominal wages, and reduced domestic policy uncertainty.
For France, the OECD anticipates GDP growth will slow to 0.6 percent in 2025 amid high economic policy uncertainty, with a gradual rebound to 0.9 percent in 2026.
It explained that private consumption will lead growth next year, while exports will decline due to growing trade tensions and investment will be restrained by ongoing uncertainty.
However, the OECD expects that increased investment alongside steady consumer spending will support France’s economic recovery in 2026.
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