OECD Economic Outlook_2024.12

Core Insights - The global economy has shown resilience despite shocks like the pandemic and energy crisis, with stable growth projected at 3.3% for 2025 and 2026, and declining inflation towards central bank targets [32][40][41] - Significant regional disparities exist, with risks from trade tensions, geopolitical conflicts, and fiscal challenges affecting growth prospects [32][41][49] Group 1: Macroeconomic Assessment - Global GDP growth is projected at 3.2% for 2024 and 3.3% for 2025 and 2026, with inflation in G20 countries expected to moderate to 3.5% in 2025 and 2.9% in 2026 [40][41] - Real household disposable income has improved, surpassing pre-pandemic levels in many OECD countries, although consumer confidence remains below historical averages [61][64] - Labour market pressures are easing, with unemployment rates near historical lows and job vacancy rates declining in several countries [53][60] Group 2: Trade and Fiscal Policies - Trade has been a crucial driver of global growth, but rising protectionism and trade tensions pose risks to supply chains and consumer prices [32][41] - Public debt levels remain high, with some emerging markets facing debt distress, necessitating credible fiscal strategies to ensure sustainability [32][41][49] - Fiscal policies need to balance spending pressures with economic growth, particularly in light of rising expenditures related to defense and aging populations [32][41] Group 3: Labour Market Dynamics - Labour shortages have intensified in sectors like health care and technology, hindering productivity and innovation [34][45] - Structural reforms in education and skills development are essential to address labour shortages and improve workforce participation [34][45] - Immigration policies and improved working conditions are critical to enhancing labour supply and reducing shortages [34][45]