OECD sees resilient global economy but warns of renewed energy shocks
The OECD says the global economy has proved more resilient than expected since the US-Israeli war on Iran began, helped by released oil reserves, lower Chinese energy imports and a switch to alternative fuels. However, it warned that the outlook depends heavily on a lasting resolution, as renewed energy disruptions could drive inflation higher and weaken growth.
The OECD raised its 2026 global growth forecast from 2.8% to 2.9%, but lowered next year’s forecast from 3.1% to 3%. It cut the UK’s 2026 inflation forecast from 3.7% to 3.1% and raised its growth forecast to 1.1%, while warning of risks including an extreme El Niño, higher government borrowing costs and falling confidence in AI-related companies.
- Global growth has weathered the Iran war better than expected.
- Energy disruption remains a major threat to inflation and growth.
- UK growth forecast rises, while inflation expectations fall.
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Originally published by The Guardian as “OECD: global economy has been more resilient to Iran war than expected”.