2019.03.0606:30:00UTC+00OECD Says Global Growth Slowing; Cuts Global Growth Forecasts

Global economic growth is slowing, driven by vulnerabilities arising from China and the weakening European economy, coupled with a slowdown in global trade growth, the Organization for Economic Co-operation and Development said Wednesday.

The Paris-based think tank slashed the global growth projections for this year and next, while warning that further trade restrictions and policy uncertainty would have additional adverse effects on global growth.

In its latest Economic Outlook report, the OECD downgraded the global growth outlook to 3.3 percent for this year and 3.4 percent for next, from 3.5 percent seen in November.

"The global economy is facing increasingly serious headwinds," OECD Chief Economist Laurence Boone said.

"A sharper slowdown in any of the major regions could derail activity worldwide, especially if it spills over to financial markets. Governments should intensify multilateral dialogue to limit risks and coordinate policy actions to avoid a further downturn."

Although policy stimulus is likely to offset weak trade developments in China, risks of a sharper slowdown that would hit global growth and trade prospects remained, it cautioned.

Economic prospects are now weaker in nearly all G20 countries than previously anticipated, the report said.

"Vulnerabilities stemming from China and the weakening European economy, combined with a slowdown in trade and global manufacturing, high policy uncertainty and risks in financial markets, could undermine strong and sustainable medium-term growth worldwide," the report said.

The think tank cut the US growth forecast to 2.6 percent from 2.7 percent for this year. The projection for next year was raised to 2.2 percent.

China's outlook was lowered to 6.2 percent for this year from 6.3 percent. For 2020, the think tank left the growth forecast unchanged at 6.0 percent.

Eurozone's growth forecasts for this year and next were cut to 1.0 percent and 1.2 percent, from the previous projections of 1.8 and 1.6, respectively.

Growth projections for the UK were trimmed to 0.8 percent and 0.9 percent, from 1.4 percent and 1.1 percent, respectively, for this year and next.