While growth remained resilient in 2024 at 3.2%, buoyed by the United States and emerging countries (led by China) the OECD fears an economic slowdown due to the trade wars taking shape under Donald Trump. Against this backdrop of “rising trade barriers in several G20 economies, and increased uncertainty about the geopolitical situation and economic policies, which are weighing on investment and household spending,” the OECD is revising its growth forecasts downwards. In 2025, the organisation is forecasting growth of 3.1%, compared with 3.3% in December. And for 2026, growth will reach 3%, compared with an estimate of 3.3% last December.
The OECD’s revised 2025 and 2026 growth outlooks. Screenshot: OECD
Economic Trumpism is set to claim its first victims in the US, where annual GDP growth is set to slow from the strong pace of recent years to 2.2% in 2025 and 1.6% in 2026, down from 2.8% in 2024. In the eurozone, growth will pick up slightly, from 0.7% in 2024 to 1% in 2025 and 1.2% in 2026. Last December, the OECD forecast was 1.3% in 2025 and 1.5% in 2026.
The OECD’s updated inflation outlook. Screenshot: OECD
In this context of economic slowdown, inflation should continue to fall. From 5.3% in 2024, it will fall to 3.8% in 2025 and 3.2% in 2026. This is below last December’s forecasts of 4.1% in 2025 and 3.5% in 2026. But, notes the OECD, underlying inflation will remain above central bank targets in many countries in 2026, including the US.
As a result, monetary policies will remain cautious and “key interest rates are likely to fall only gradually,” says the organisation.
This article in French.