PARIS, FRANCE / RankWire.AI / – According to the OECD, the projection for worldwide economic expansion in 2026 has been revised upward to 2.9%, reflecting a more resilient global economy than previously anticipated. This update marks an increase from the 2.8% forecast issued in June. Conversely, the OECD has lowered its 2027 growth estimate slightly from 3.1% to 3.0%. Ongoing robust investments, particularly in artificial intelligence, continue to bolster production, trade, and overall economic activity. Nonetheless, elevated energy prices and persistent inflationary pressures remain significant challenges for major economies.
The September Interim Economic Outlook indicated that during the first half of 2026, global growth experienced a slowdown. The annualized rate declined to 2.6%, down from 3.6% in the latter half of 2025. Despite this slowdown, economic activity in many countries that import and export energy proved stronger than expected. Factors such as increased oil inventories, additional production outside the Gulf, and alternative supply routes contributed to mitigating the energy shock. Reduced oil demand from China also played a role in stabilizing global energy markets.
The OECD highlighted that technology investment continues to be a primary driver of economic support. Sharp increases in semiconductor exports were recorded in Korea and Japan, with China also experiencing stronger technology export figures. Industrial output linked to technological advancements maintained rapid growth throughout much of Asia. Similar positive trends were observed in the United States and several European nations. Additionally, consumer confidence in advanced economies improved after May, and unemployment rates remained low in many countries. However, household purchasing power faced ongoing pressure from rising fuel costs.
US Economy Gains Momentum Amid Subdued Eurozone Growth
The US economy is projected to expand by 2.2% in 2026 and 2.1% in 2027. Investment related to artificial intelligence remains a key support, though slower consumer spending and weaker growth in real incomes are tempering overall gains. Meanwhile, the euro area’s GDP is forecast to increase by 1.0% in both years, hindered by higher energy costs and interest rates. Japan is expected to grow 0.8% in 2026 before a slight slowdown to 0.7% in 2027.
China’s economy is anticipated to grow 4.5% in 2026, then ease to 4.2% in 2027. India’s growth is forecast at 7.1% for the fiscal year 2026-27, following 7.8% in the previous fiscal period, with an expected 6.5% in 2027-28. Indonesia’s expansion is projected at 5.2% in 2026 and 5.1% in 2027, while Mexico’s economy is set to grow 1.5% this year and 1.8% in 2027.
Inflation in G20 Countries Rises as Energy Costs Continue to Impact Prices
Inflation remains a key concern highlighted in the OECD outlook. Overall inflation across G20 nations is projected at 4.1% in 2026, an increase from 3.4% in 2025. It is expected to decrease slightly to 3.6% in 2027. Advanced economies within the G20 are forecast to see inflation of 3.2% this year and 2.6% next year. Specifically, the United States’ rate is expected to fall from 3.6% in 2026 to 2.6% in 2027. The euro area’s inflation is estimated at 3.0% and 2.9% respectively.
Rising energy prices have contributed to increased household costs and renewed inflationary pressures in many economies, the OECD noted. Additionally, long-term government bond yields have gone up as public borrowing and debt service costs increase. Mathias Cormann, OECD Secretary-General, stated that global growth has held up better than anticipated, despite economic weaknesses compared to last year. The organization recommends implementing targeted temporary measures, maintaining sustainable public finances, and enhancing long-term productivity. It also calls for governments to focus on expanding skills, diversifying energy sources, and promoting wider adoption of artificial intelligence.