U.S. Economic Growth Outlook Slashed to 1.6% by OECD

U.S. gross domestic product (GDP) is forecasted to grow by 1.6% this year, according to a new forecast from the Organization for Economic Cooperation and Development (OECD), down from its previous estimate of 2.2% and from 2.8% in 2024. The organization cited higher trade barriers, lower confidence, and rising policy uncertainty as reasons for the lowered forecast.

OECD Cuts Global Economic Growth Outlook

It isn’t just the U.S. that saw its GDP forecast cut. The OECD also lowered its forecast for 2025 global economic growth to 2.9% from 3.1%. The U.S, Canada, Mexico, and China are the countries most responsible for reducing the forecast. In addition, the OECD cut its 2026 global GDP outlook to 2.9% from 3.0%.

The forecast provides a gloomy and uncertain picture, as global economic growth has exceeded 3% every year since 2020, which was the year of the coronavirus pandemic.

“The global economy has shifted from a period of resilient growth and declining inflation to a more uncertain path,” said OECD Secretary-General Mathias Cormann. “Our latest economic outlook shows that today’s policy uncertainty is weakening trade and investment, diminishing consumer and business confidence and curbing growth prospects.”

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