OECD: Trade policy tensions to support the growth of global economy

Economic The OECD of Cooperation and Development is calculating its prediction of world economic growth this year.

According to the organization, growth prospects are emphasized by increased trade policy tensions and duties that rose to the world politics negotiating tables after Donald Trump returned to the President of the United States. The organization warns that a wider trade war could further slow down growth.

In its business cycle report, released on Monday, OECD predicts that the global economy will increase by 3.1 per cent this year. In December, the organization predicted this year’s growth by 3.3 percent.

According to the OECD forecast, economic growth will slow down to 3.0 % next year. Last year, the global economy is estimated to increase by 3.2 %.

OECD considers in its forecast that “barriers to trade in several G20 countries, as well as increased geopolitical and political uncertainty, weigh investment and household consumption.”

According to OECD, the Customs Raising Spiral, started by President Trump, accelerates more inflation that the organization has previously estimated, even though the slowdown in economic growth is a reduction in the rise of consumer prices.

The organization predicts that inflation will slow down to 3.8 % this year and 3.2 % next year in the G20. The organization estimates that the bottom inflation cleaned of food and energy prices remains higher than the central banks’ inflation target in many countries.

OECD:n The new growth forecast is especially based on lower growth in US and euro area economies.

The OECD now predicts that the US economy will increase by 2.2 per cent this year and 1.6 per cent next year. Previous forecasts were 2.4 % for this year and 2.1 % for next year.

The growth forecast for the current year of the euro area came down to 1.0 % from 1.3 % predicted in December. However, OECD estimates that economic growth in the euro area will accelerate to 1.2 % next year.

The Chinese Economic Growth Organization predicts 4.8 % this year and 4.4 per cent next year.

OECD In its review, the forecast has taken into account the additional duties of both US Canada and Mexico, as well as Canada and Mexico counterparts. These duties are due to enter into force in April.

According to the organization, the financial activity would be stronger and the rise in consumer prices in these three countries would be slower if duties were lower.

The forecast does not include US -Chinese customs and no customs on steel and aluminum.

According to the OECD, there are significant risks associated with trade policy relationships between states, and the “fragmentation” of the global economy is a central concern.

According to the organization, wider increases to “trade barriers” would affect growth throughout the world and accelerate inflation.