Global economic growth should be slower this year largely because of the American prices of Donald Trump, according to a leading international policy group.
Global growth should now slow down to a “modest” of 2.9%, against a previous forecast of 3.1%, said the Organization for Economic Cooperation and Development (OECD).
He blamed a “significant” increase in commercial barriers and warned that “weakened economic perspectives will be felt in the world, without any exceptions”.
This will include the United Kingdom, said the OECD because it has reduced the country’s growth forecasts. But he added that Great Britain was faced with its own challenges and should consider increasing tax revenue as a means of “strengthening public finances”.
Since the return of the American president to the White House, a long list of countries has been targeted by prices, but the unpredictable approach of Trump to implement the measures has created a general uncertainty.
“We mainly plan a demotion for almost everyone,” said Alvaro Pereira, the OECD chief economist at the BBC.
“We will have much less growth and job creation that we had planned in the past.”
The group has also reduced the prospects of the US economy this year from 2.2% to 1.6% and the predicted growth would slow again in 2026.
He warned that the United States was in danger of an increase in inflation, which Trump has promised several times would fall during his presidential campaign.
Before the publication of the OECD report Tuesday, Trump wrote on social networks: “Due to prices, our economy is booming!”
However, the most recent official data has shown that the US economy has shrunk at an annual rate of 0.2% in the first three months of this year, the first contraction since 2022.
Meanwhile, the OECD reduced its expectations for the UK growth this year to 1.3% against 1.4% that it predicted in March.
He also planned that the British economy would extend from 1% in 2026, against 1.2% in the pencil a few months ago.
The OECD said that the UK growth would be “attenuated by increased trade tensions” as well as “high uncertainty”.
But the group said that Great Britain had other questions, in particular substantial establishment payments and a “very thin” financial stamp.
In March, Chancellor Rachel Reeves was forced to announce 14 billion pounds in measures, including 4.8 billion sterling pounds in reduction in social protection, to restore the space for the head against her self-imposed tax rules.
While the OECD has highlighted British economic growth better than expected, which has increased to 0.7% between January and March, it was warned that “the momentum is weakening” due to the “deterioration” of the feeling of companies.
He suggested that Reeves increases tax revenue, in particular by concluding gaps and by reassessing the council tax bands on the basis of the value of the updated properties.
As part of the current system, the Council Tax in England is calculated according to the price for which the property would have sold in April 1991. For Wales, it was evaluated on real estate prices in April 2003.
Next week, Reeves will exhibit her expenditure exam where she faces difficult choices to allocate ministerial budgets.
The OECD said: “The strengthening of public finances remains a priority, by providing ambitious government budgetary plans, including through the review of future expenses.”
The government has already committed billions of pounds to defense, while the NHS should also be an objective in the middle of the work commitment to reduce the waiting lists.
