The newly released world economic outlook report from OECD has outlined a bright picture of the world economy, with outstanding consumer demand. The OECD pointed out that this positive result is results from financial policy loosening of governments in many countries. In addition, many countries have issued solid macroeconomic policies that help promote growth, raise workers’ incomes, and huge investment in artificial intelligence (AI).
OECD has changed its forecasts for the “health” of key economies, mostly in a positive direction. Contributing significantly to the brighter global economic outlook, the US economy is expected to grow by 2% in GDP in 2025, 0.2 percentage points higher than the forecast released from OECD in September. For the Eurozone, OECD forecasts a growth rate of 1.3% this year, up 0.1 percentage point from the previous forecast.
OECD has also revised its 2026 growth forecasts for the US and Eurozone to 1.7% and 1%, respectively — both higher than earlier forecasts. World economic growth is expected to reach 3.2% in 2025, slightly down from 3.3% in 2024, before slowing further to 2.9% in 2026 and then “rebounding” to 3.1% in 2027. The OECD said it should “commend” the world economy for its strong resilience in 2025. Another bright spot comes from emerging Asian economies, which are making positive contributions to global growth.
In overall bright economic picture, there are still some gloomy shades. In Germany, the Federation of German Industries (BDI) warns that the Eurozone’s leading economy is experiencing its worst crisis since the Second World War. BDI forecasts that Germany’s industrial output in 2025 will fall for the fourth consecutive year, stressing that the downturn is structural rather than temporary.
The slowdown of Europe’s largest economy comes from high energy costs burdening enterprises, weak export demand in key markets, competition from China in the industrial sector, and high US tariffs. After two years of recession, Germany’s economy is only forecasted to grow modestly in 2025. Peter Leibinger, BDI President, has called on Chancellor Friedrich Merz’s Government to take stronger action, prioritising competitiveness and growth, saying that current measures, though quite strong, are not yet effective enough.
On the other side of the Atlantic, the “health” of the US economy has also raised concern, though not seriously. US companies cut 32,000 jobs in November, completely contrary to forecasts that expecting 20,000 new jobs to be created.
According to economist Nela Richardson, recent recruitment difficulties stem from an unsustainable macroeconomic environment and cautious consumer sentiment affecting employers. She noted that November’s job cuts mainly occurred among small businesses, which are most affected by reciprocal tariff policies introduced under President Donald Trump’s administration. Heather Long, Chief Economist at Navy Federal Credit Union, warned that this is not a seasonal job loss, but a wave of mass layoffs.
Analysts say that in an uncertain and unpredictable world, each country and each economy need to be prepared for unexpected situations.
