OECD Raises 2025 Forecast to 3.2%, Warns on Tariffs

The OECD has raised its global growth forecast to 3.2% for 2025 (up from 2.9% in June) and expects 2.9% in 2026, citing stronger-than-expected first-half resilience driven by emerging markets, front‑loading ahead of new U.S. tariffs and strong AI-related investment. It lifted the U.S. 2025 forecast to 1.8% (from 1.6%), though U.S. growth is expected to slow to 1.5% in 2026. The OECD warned the full effects of sharply higher U.S. tariffs—now at historically high effective rates—have yet to be felt and pose a major downside risk alongside weakening labour markets, re‑emerging inflation risks and financial‑stability concerns such as crypto volatility. Germany is singled out as an underperformer (about 0.3% growth) with industrial weakness also in South Korea and Brazil, while forecasts were nudged up for China, the euro area and Japan. Separately, the OECD raised Türkiye’s 2025 growth outlook to 3.2% (also 3.2% in 2026) but warned this momentum is likely temporary and projected headline inflation to remain very high next year (33.5% in 2025, easing to 19.2% in 2026).