OECD Raises 2024 World Economic Growth Forecast to 3.2%
PARIS, September 25, 2024 — The Organisation for Economic Co-operation and Development (OECD) has raised its 2024 world economic growth forecast to 3.2%, according to a report released on September 25.
The OECD’s latest economic outlook report indicates that global economic growth is becoming more stable, with central banks in some countries no longer raising interest rates, and inflation rates gradually declining. Household incomes are expected to increase. The report notes that the economic growth of some members of the G20 is strong, which is beneficial to the global economic recovery.
The OECD raised its 2024 global economic growth forecast from 3.1% to 3.2%, while maintaining the 2025 forecast at 3.2%. OECD Secretary-General Mathias Cormann stated that the decline in inflation rates provides space for lowering interest rates, but countries should still be cautious with their monetary policies until inflation returns to the central banks’ targets. He also emphasized the need for decisive policy actions to reallocate fiscal spending to support economic growth and stabilize finances through optimized tax revenues. To enhance the long-term growth prospects, he urged accelerating structural reforms.
OECD Chief Economist Frans Paredes noted that fiscal issues have not received sufficient attention in recent years, and the economy is facing multiple pressures, including climate change, an aging population, increased military spending, and debt burdens. He also warned that the inflation crisis is not yet over, and inflation rates in many countries still need to decline further.
The OECD has raised India’s 2024 and 2025 economic growth forecasts to 6.7% and 6.8%, respectively. The 2024 U.S. economic growth is still forecasted at 2.6%, while the eurozone’s 2024 and 2025 growth forecasts are 0.7% and 1.3%, respectively. The OECD raised France’s 2024 economic growth forecast to 1.1%, attributing it to lower interest rates, increased consumption, and the positive effects of the Paris Olympics. However, the OECD expects Germany’s economy to remain weak, with a 2024 growth forecast of just 0.1%.
The global economic landscape is becoming more stable, with inflation rates declining and central banks pausing their rate hikes. However, fiscal and monetary policies still need to be carefully managed to ensure sustained economic growth, said Cormann.
This forecast comes as a positive signal for global economic recovery, although it highlights the ongoing challenges and uncertainties in the global economy. As the world continues to navigate through the complexities of economic and geopolitical issues, the OECD’s updated forecast serves as a guide for policymakers and stakeholders.
The full report can be accessed here. For more updates on global economic trends, please visit our Caucus section.
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