View more on these topics

OECD raises growth forecasts but warns of increasing risks

The Organisation for Economic Cooperation and Development has raised its growth forecasts for this year and 2011 in its latest Economic Outlook.

In 2010 and 2011 the OECD forecasts that GDP across OECD countries will rise by 2.7 per cent and 2.8 per cent respectively. This is up from its last forecast in November last year when it predicted GDP growth of 1.9% in 2010 and 2.5% in 2011.

It warns that at the same time, the risk of overheating and inflation is rising in emerging markets.

In America, the OECD predicts GDP to expand by 3.2 per cent in 2010 and a further 3.2 per cent in 2011, while the eurozone economy is forecast to expand by 1.2 per cent this year and 12.8 per cent in 2011.

Meanwhile, if non-OECD members are added to the equation, the global economy is expected to grow 4.6 per cent in 2010 and 4.5 per cent in 2011.

Rising trade flows and strong growth in China and other emerging markets is helping pull countries out of recession, according to the OECD. However, it warns that at the same time, the risk of overheating and inflation is rising in emerging markets.

“A boom-bust scenario cannot be ruled out, requiring a further tightening in countries such as China and India,” says the report. “The knock on effect would be slower growth in other regions.”

Another risk for growth is the instability in sovereign debt markets, adds the OECD. This instability, the report says, has highlighted the need for the eurozone to strengthen its institutional and operational architecture.

As a result the Outlook says bolder measures need to be taken to ensure fiscal discipline.

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment

    Close

    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm

    Email: customerservices@moneymarketing.com