These expectations are part of a slight modification of the organization’s economic forecasts for the year 2023.
In its latest report, the organization predicted the global economy would grow 2.7% this year, down from 2.6% in its March forecast.
The Paris-based organization added that despite the support stemming from China’s abolition of anti-coronavirus restrictions, growth will register the lowest annual rate since the global financial crisis, which occurred in 2008 and 2009, at the exception of 2020, which was hit hard. by the pandemic.
The Organization for Economic Co-operation and Development said growth would pick up only slightly next year to 2.9%, unchanged from the March forecast, given the growing impact of interest rate hikes. interest by major central banks over the past year on private investment, starting with the housing market.
“The global economy is at a crossroads,” said Claire Lombardelli, the organization’s new chief economist.
According to the organization’s report, the world economy is benefiting from stagnant inflation, after the rise in indicators observed last year, due to the repercussions of the war in Ukraine on energy and oil prices. feed.
In May, for example, inflation slowed markedly in the euro area, reaching 6.1% on an annual basis, and in the United States it reached 4.4% in April, well below the levels reached in 2022.
And this slowdown, according to the report, allows central banks to limit the rise in interest rates, which bodes well for access to credit for households and businesses, consumption and therefore growth.
And the recent upturn in Chinese economic activity after the strict zero Covid policy is enough to revitalize the global economy, according to the organization, which expects growth in China to reach 5.4% this year, or an increase of 0.1 points compared to March expectations, and 5.1% next year.
the path is long
The Organization for Economic Co-operation and Development expects growth of 0.9% in the euro zone this year, up slightly by 0.1 points, after having revalued Italian GDP growth at 1.2%.
The growth rate in France is assumed to be 0.8% and nil in Germany.
The UK could see growth of 0.3% this year as the Organization for Cooperation and Development predicted a recession.
Outside of Europe, US GDP is expected to grow by 1.6% and India’s by 6%.
Among the challenges cited by the organization is the persistence of non-energy and food inflation, which “remains high” and forces central banks to “maintain tight monetary policies until clear signs” of its decline appear. , according to Lombardelli.
However, high interest rates prevent the global economy from growing more clearly, reducing the distribution of credit and encouraging saving rather than consumption.
The report notes that “almost all countries have higher deficits and debt than before the pandemic and many are facing growing pressures on public spending linked to aging populations, climate change and the cost of debt. “.
In turn, the World Bank had raised its expectations for the growth of the global economy in the current year from 1.7%, according to its expectations published in January, to 2.1%, in its latest report. , “Global Economic Prospects”, compared to 3.1% reached by the economy in 2021.
The bank also revised its forecast for the global economy for 2024 to 2.4% from its previous forecast in January, which was 2.7%.
The World Bank said in its report that global growth has slowed sharply and the risks of financial stress in emerging and developing economies are intensifying amid rising global interest rates.
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