Global economy to grow faster than expected, OECD says

The global economy is expected to grow faster than previously projected this year after weathering the impact of US President Donald Trump’s tariffs, the Organization for Economic Co-operation and Development (OECD) said.

However, the OECD still warned that the overall effects of the tariffs remain uncertain.

Back in June, the organization originally cut its forecast from 3.1 percent to 2.9 percent projected growth, warning that Trump’s tariffs would hamper the global economy. 

Now, they have raised the forecast to 3.2 percent and said that the economy ‘proved more resilient than anticipated’ in the first half of 2025.

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According to the OECD, front-loading of imports ahead of Trump’s tariffs by companies played a key role in supporting the economy

AI-related investment in the United States and government spending in China also boosted the economy, it added. 

Despite the reassessment, the new figure is still a slight slowdown from 3.3 percent in 2024.

"The full effects of tariff increases have yet to be felt, with many changes being phased in over time and companies initially absorbing some tariff increases through (profit) margins," the OECD said. 

"But (they) are becoming increasingly visible in spending choices, labour markets and consumer prices," the report.

World growth is due to slow to 2.9 percent in 2026 "as front-loading ceases and higher tariff rates and still-high policy uncertainty dampen investment and trade", the OECD said.