The OECD recently published the latest Economic Outlook which provides a global and cross-country overview of the current GDP growth rates and projections for the next two years. The global economy is projected to remain resilient despite significant challenges with a global GDP growth projection of 3.3% in 2025, up from 3.2% in 2024, and 3.3% in 2026.
As shown by the study, there is great heterogeneity between countries what concerns growth rates with India as the leader in the G20 economies for 2024, 2025, and 2026, while Argentina closed the ranking for 2024 with a negative growth rate (-3.8%) but with significant positive projections for the next two years. Also, the inflation rates are generally expected to decrease considering OECD countries—such reduction results from the restrictive approach adopted by many countries in the last months concerning monetary policies. According to the report’s results, central bank policy rate reductions should be kept active in most of the OECD countries, while paying particular attention to their timing and extent to avoid underlying inflationary pressures emerging. On another point, robust structural reforms are considered necessary to reinvigorate low potential output growth. This means that further investments in education and skills development of the labor force should be considered a priority to respond to the needs of companies and to take the most from investments and labor mobility opportunities.
Finally, a non-negligible element concerns the influence on the economy of the on-going conflicts and geopolitical tensions especially in the Middle East that create uncertainty and pose short-term risks, as pointed out by OECD Secretary-General, Mathias Cormann.
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Source: INSME Secretariat
