OECD Upgrades G20 Inflation Forecast and Adjusts Global Growth Outlook
The Organisation for Economic Co-operation and Development has released new data for the 20 major economies in line with energy costs and geopolitical risks.
The Organisation for Economic Co-operation and Development has raised its 2027 inflation forecast for the G20 group to 3.6 percent due to rising energy costs and geopolitical tensions, while also updating its global economic growth expectations.
G20 Inflation Forecast Raised
In line with rising energy costs and ongoing geopolitical tensions, the Organisation for Economic Co-operation and Development increased its 2027 inflation forecast for the G20 group to 3.6 percent, up 0.5 percentage points compared to the June projection.
The organization stated that while there is a gradual but volatile cooling trend in global prices, it still projects G20 inflation to remain below 4.1 percent in 2027.
Expected Rates in Major Economies
According to the assessments, inflation rates in major economies are projected to reach 2.6 percent in the United States and 2.9 percent in the Euro Area in 2027.
On the other hand, as a result of the combined effect of high energy prices and a weak yen, inflation in Japan is also expected to rise to 2.6 percent.
Energy Markets and Risk Factors
The Organisation for Economic Co-operation and Development issued serious warnings, drawing attention to the fact that the global economic outlook remains uncertain, particularly in the context of energy markets.
Disruptions in liquefied natural gas supply and the competition for gas storage between Europe and Asia ahead of the upcoming winter season are increasing risks.
Middle East and Natural Gas Supply
The report also emphasized the lasting impacts of tensions in the Middle East on supplies from the Gulf region, notably Qatar, which is a major exporter of liquefied natural gas.
Updating Global Growth Data
In light of these economic developments, the organization lowered its global economic growth forecast for 2027 to 3 percent, while slightly increasing the growth forecast projected for the current year to 2.9 percent.