AKP Phnom Penh, March 18, 2025
Global GDP growth is projected to moderate from 3.2 percent in 2024 to 3.1 percent in 2025 and 3.0 percent in 2026, the Organization for Economic Cooperation and Development (OECD) said on Monday in its latest Economic Outlook.

According to the OECD, the downward adjustment from its previous forecast is due to "higher trade barriers in several G20 economies and increased geopolitical and policy uncertainty weighing on investment and household spending."

"Higher and broader increases in trade barriers would hit growth around the world and add to inflation," the OECD warned.

In its previous Economic Outlook published in December 2024, the OECD projected that global GDP growth would be 3.3 percent in 2025 and 2026.

The GDP growth in the United States is projected to slow as tariff rate increases take effect. According to the organization, U.S. GDP growth is projected to slow to 2.2 percent in 2025 and 1.6 percent in 2026.

The OECD also warned that the imposition of new bilateral tariff rates and the associated increase in policy and geopolitical uncertainty will act as a drag, particularly on business investment and trade.

"In addition, increased trade costs are expected to feed through gradually to final goods prices, putting additional upward pressure on inflation in many countries," it stressed.

The OECD noted that core inflation in over half of the advanced G20 economies, including the United States, is expected to remain above central bank targets in 2025 and 2026.

AKP-Xinhua