- ORIGINAL NEWS
UK to suffer slowest growth of all rich nations next year, OECD says
- SUMMARY
The United Kingdom’s economic prospects are not as bright as other advanced nations.
The Organisation for Economic Cooperation and Development (OECD) has predicted that the UK will have the weakest economic performance among these countries in the coming year, with a growth rate of just 0.4%.
This is a downward revision from the organization’s previous projection of 0.7%, indicating a further pessimism about the UK’s economic trajectory.
While the global economy is showing signs of recovery, the UK’s growth is expected to remain sluggish due to the lingering effects of high interest rates and inflation.
The OECD predicts that the UK’s GDP will grow at a rate below all G7 countries except Germany in 2024, and still behind most of them in 2025.
The UK’s sluggishness contrasts with the general improvement in the global economy.
Growth in North America is expected to be robust, led by the US.
Europe is also forecast to pick up pace, benefiting from the easing of energy constraints.
China, despite recent challenges, is showing signs of strength with revised upward growth projections.
The OECD believes that central banks’ efforts to combat inflation are yielding results.
Inflation is projected to fall globally to 5% in 2024 and further to 3.4% in 2025, returning to the target range of around 2% by the end of that year.
However, concerns remain about the stickiness of inflation, as there is a risk that monetary policy may need to remain restrictive for longer.
Overall, while the global economy is on a path to recovery, the UK’s prospects are relatively bleak.
Its sluggish growth is expected to be the lowest among advanced economies, indicating challenges that may require targeted policy interventions to stimulate economic activity.
- NEWS SENTIMENT CHECK
- Overall sentiment:
negative
Positive
“The downbeat prediction comes as the global economy shows signs of recovery, with growth forecast to remain steady at 3.1% in 2024, before rising modestly to 3.2% in 2025.”
“”We start seeing some recovery in many parts of the world,” Alvaro Pereira, director of the OECD’s policy studies branch, told CNBC’s Silvia Amaro Thursday.”
Negative
“The U.K.’s “sluggish” growth prospects have put it on course to be the worst-performing economy of all advanced nations next year, according to the OECD.”
“U.K. gross domestic product (GDP) is expected to grow by 0.4% in 2024, down from a previous prediction of 0.7%, and less than all other G7 countries besides Germany (0.2%), the Paris-based think tank said Thursday in its latest global economic outlook.”