THE world economy will grow more than previously forecast this year after absorbing the shock of US President Donald Trump’s tariffs, but their full impact remains uncertain, the OECD said Tuesday.
In June, the Paris-based organization had cut its forecast from 3.1 per cent to 2.9 per cent, warning at the time that Trump’s tariffs would stifle the world economy. But in an updated outlook on Tuesday, it raised the projection to 3.2 per cent, saying the economy “proved more resilient than anticipated” in the first half of 2025.
The OECD said “front-loading” — companies rushing to import goods ahead of Trump’s tariffs — “was an important source of support”. The economy also got a boost from strong AI-related investments in the United States and government spending in China.
The updated figure is still a slight slowdown from 3.3 per cent in 2024. “The full effects of tariff increases have yet to be felt — with many changes being phased in over time and companies initially absorbing some tariff increases through (profit) margins,” the Organization for Economic Co-operation and Development said. “But (they) are becoming increasingly visible in spending choices, labour markets and consumer prices,” the report.
AFP
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