Global economy remains weak, OECD says, cutting growth forecast
WASHINGTON -- The global economic recovery remains weak and growth this year will be lower than projected six months ago but will pick up in 2014, the Organization for Economic Cooperation and Development said Wednesday.
World economic output is expected to increase 3.1% this year, down from a forecast of 3.4% in November, according to the group’s semi-annual Economic Outlook report.
The forecast for growth in the U.S. also was downgraded, to 1.8% in the latest report from 2% six months ago.
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The recovery will pick up next year, with gross domestic product forecast to increase to 4% worldwide, down from the November forecast of 4.2%, the OECD said.
The U.S. economy is projected to grow by 2.8% in 2014, the same as forecast six months ago.
The U.S. economy, the world’s largest, has been boosted by a soaring housing market. It is a bright spot in the world economy, the OECD said. Japan’s economy also is improving and is projected to grow 1.6% this year.
The OECD’s 34 member countries -- the world’s most advanced economies -- are expected to see combined economic growth of only 1.2% this year, down from November’s projection of 1.4%.
Those nations will see economic growth increase next year to 2.3%, the OECD said.
The Eurozone is a drag on growth among OECD nations, with the economy of that region forecast to contract 0.6% this year before rebounding to 1.1% growth in 2014.
The continuing recession in Europe has led to a record high 12.1% unemployment rate in March.
“The failure of the global economy to recover more strongly has posed a heavy burden on people. … Unemployment remains far too high in some countries it is already at record levels and still rising in the case of the Euro area,” said OECD Secretary-General Angel Gurría.
Gurria said the global recovery has been “hesitant and uneven” and “the situation remains particularly fragile in Europe.”
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