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OECD warns of global slowdown

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The Organisation for Economic Cooperation and Development (OECD) has warned that the global economy has peaked and faces a slowdown driven by international trade tensions and tighter monetary conditions. The OECD, which groups the top developed economies, said it had trimmed its growth forecast for 2019 to 3.5% from the previous 3.7%. The 2018 estimate was left unchanged at 3.7%. For 2020, the global economy should grow 3.5%, it said in its latest Economic Outlook report.Trade tensions have already shaved 0.1-0.2 percentage points off global GDP this year. If Washington were to hike tariffs to 25 per cent on all Chinese imports – as Trump has threatened to do – world economic growth could fall to close to three per cent in 2020. The shakier outlook in 2019 reflects deteriorating prospects, principally in emerging markets such as Turkey, Argentina and Brazil. The further slowdown in 2020 is more a reflection of developments in advanced economies as slower trade and lower fiscal and monetary support take their toll. For the moment, the OECD puts US economic growth at 2.9 per cent this year and 2.7 per cent in 2019, but trimmed China by 0.1 percentage point each to 6.6 per cent and 6.3 per cent.