OECD cuts 2019 global economic growth forecast to 3.2% from 3.3% in March

OECD releases its latest economic outlook on the global economy

  • 2020 global economic growth seen at 3.4% (unchanged)
  • Says that global growth is to remain sub-par due to trade tensions
  • 2019 US economic growth seen at 2.8% (0.2% higher)
  • 2020 US economic growth seen at 2.3% (0.1% higher)
  • 2019 China economic growth seen at 6.2% (-)
  • 2020 China economic growth seen at 6.2% (-)
  • 2019 Eurozone economic growth seen at 1.2% (0.2% higher)
  • 2020 Eurozone economic growth seen at 1.4% (0.2% higher)
  • 2019 Japan economic growth seen at 0.7% (0.1% lower)
  • 2020 Japan economic growth seen at 0.6% (0.1% lower)
  • 2019 UK economic growth seen at 1.2% (0.4% higher)
  • 2020 UK economic growth seen at 1.0% (0.1% higher)
Despite a slightly improved outlook to more major/developed nations, OECD notes that trade disruptions and higher tariffs on US-China trade is likely to hit global growth further resulting in a sharp slowdown in investment and confidence faltering.
The slight downgrade to global growth forecast comes alongside a softer touch among more developing nations, particularly in Asia. It’s not much of a surprise as trade tensions are likely to hit the likes of South Korea first before other nations start feeling the pinch.
As far as bad news goes for risk sentiment today, this is very much bearable as the downgrade to the global growth forecast is rather minimal.