The Organisation for Economic Co-operation and Development (OECD) has revised its annual global growth forecast downwards, warning that the tariff policies implemented by former U.S. President Donald Trump could harm the global economy and significantly impact the United States. In its Tuesday report, the OECD projected global economic growth at a modest 2.9% for this year and next, following a 3.3% expansion in 2024. This is lower than its previous estimates of 3.1% for 2025 and 3% for 2026. The report highlighted that rising trade barriers, tighter financial conditions, and weakened business and consumer confidence are increasing policy uncertainty, negatively affecting growth if these trends persist. For the U.S., the OECD cut its GDP growth forecast to just 1.6% this year, down from 2.2%, with further deceleration to 1.5% expected next year due to increased tariffs and retaliatory measures by some trading partners. The organization also slightly lowered China’s growth forecast from 4.8% to 4.7% for this year. Additionally, the OECD noted that higher trade costs, particularly in tariff-imposing countries, will push inflation up, though this will be partially offset by falling commodity prices.
— new from Argaam
