OECD significantly downsizes economic forecasts


The global economy is likely to grow by 3.0 percent this year, but only by 2.2 percent in 2023.

(Photo: Reuters)

Berlin The Industrialized Nations Organization OECD reckons because of the consequences of the war in the Ukraine with an ever weaker development of the world economy. In Germany the economy is likely to shrink next year, making it one of the countries most affected.

the inflation will probably decrease in 2023 compared to 2022, but will remain very high. The situation could worsen if the winter were particularly cold or if the energy shortage became even worse.

“The global economy lost momentum this year,” she said OECD on Monday. Surveys in the economy and weak consumer confidence point to a longer phase with subdued prospects.

The global economy is likely to grow by 3.0 percent this year, but only by 2.2 percent in 2023. That would be 0.6 percentage points less for next year than expected in June. For comparison: in 2021 there was still a strong increase of 5.8 percent due to the recovery from the corona pandemic.

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According to the OECD, Germany will develop significantly worse. Growth of 1.2 percent is expected in 2022, 0.7 points less than before. In 2023, the economy is likely to shrink by 0.7 percent, 2.4 points less than forecast in June.

A much slower pace is also expected for the USA and China. However, there is still growth here. The Russian economy is expected to contract by 5.5 percent in 2022.

Western sanctions are reasons for decline

But that’s a lot less than expected. In 2023 there is likely to be another 4.5 percent decline. The main reason for this are the Western sanctions imposed because of the Russian attack on Ukraine.

Inflation in the 20 leading industrialized and emerging countries, which has shot up significantly since the outbreak of war in Ukraine, is likely to be 6.6 percent in 2023. In 2022 it will probably be 8.2 percent. Both values ​​are higher than last expected.

Here, too, Germany is particularly affected due to its heavy dependence on Russian energy supplies. For Germany, the OECD expects an inflation rate of 8.4 percent in 2022, and then 7.5 percent in 2023. That is 1.2 or 2.8 points more than before.

In contrast, in the US, where interest rates have been raised earlier and more, inflation is likely to fall to 3.4 percent in 2023 after rising to 6.2 percent this year.

More: Lowest value since 2020: Sentiment in the German economy is deteriorating

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