Key facts
- Global growth is forecast to slow to 2.9% in 2026 and 3.0% in 2027.
- AI infrastructure spending is a key pillar of resilience this year.
- Risks from energy markets, extreme weather, and rising bond yields could reduce global growth by 0.7 percentage points in 2027.
- G20 inflation is forecast at 4.1% in 2026 and 3.6% in 2027.
- US growth is seen at 2.2% this year and 2.1% in 2027, with AI investment offsetting weaker consumer spending.
- Euro zone growth is seen holding at 1.0% in both 2026 and 2027.
The Organisation for Economic Co-operation and Development (OECD) forecasts that global economic growth will slow to 3.0% in 2027, a slight downgrade from its June projection of 3.1%. This slowdown is attributed to an entrenched energy shock stemming from the Middle East conflict, which is expected to weigh on momentum.
Despite these headwinds, AI-led investment in areas like data centers and semiconductors has provided a significant boost to the global economy this year, contributing to a slightly better-than-expected outlook for 2026, projected at 2.9% growth. This investment has particularly supported growth in the United States and lifted technology exports from Japan and Korea.
However, the OECD warned that the global outlook remains clouded by several risks. These include potential energy market volatility, extreme weather events associated with a strong El Niño, surging government bond yields, and disappointing returns on AI investments. The organization estimated that if these risks materialize, they could collectively reduce global growth by 0.7 percentage points in 2027 and increase global inflation by 1.1 percentage points.
Inflation in G20 economies is projected to be 4.1% in 2026 and 3.6% in 2027, both higher than previously forecast. The OECD suggested that central banks might need to adjust interest rates if price pressures broaden or growth falters.
Regional outlooks show divergent trends. The US economy is expected to grow by 2.2% this year and 2.1% in 2027, with AI investment offsetting weaker consumer spending. China's growth is forecast to slow to 4.5% this year and 4.2% in 2027, unchanged from previous estimates. The Euro zone is projected to grow at 1.0% in both 2026 and 2027, impacted by higher energy prices and interest rates, though new defense spending may offer support. Japan's economy is expected to grow 0.8% in 2026 and 0.7% in 2027, with rising policy rates and costly energy imports offsetting business investment.