ECONOMY
UK to suffer slowest growth of all rich nations next year, OECD says
- The U.K.’s “sluggish” growth prospects have put it on course to be the worst-performing economy of all advanced nations next year, according to the OECD.
- The downbeat prediction comes as the global economy shows signs of recovery, with growth forecast to remain steady at 3.1% in 2024 before rising modestly to 3.2% in 2025.
- Alvaro Pereira, director of the OECD’s policy studies branch, told CNBC the forecasts indicated that central banks’ efforts to quell inflation were working.
The U.K.’s “sluggish” growth prospects have put it on course to be the worst-performing economy of all advanced nations next year, according to new forecasts from the Organization for Economic Cooperation and Development.
U.K. gross domestic product is expected to grow 0.4% in 2024, the Paris-based think tank said Thursday in its latest global economic outlook. That figure is down from a previous prediction of 0.7% and less than all other G7 countries besides Germany, which is expected to be 0.2%.
The British economy is then forecast to expand by 1% in 2025, behind Canada, France, Germany, Japan and the U.S. as the lingering effects of high interest rates and inflation continue to weigh.
The downbeat prediction comes as the global economy shows signs of recovery, with growth forecast to remain steady at 3.1% in 2024 before rising modestly to 3.2% in 2025.
“We start seeing some recovery in many parts of the world,” Alvaro Pereira, director of the OECD’s policy studies branch, told CNBC’s Silvia Amaro Thursday.
Growth among advanced nations next year is set to be led by North America, which Pereira said follows “strong growth” forecasts of 2.6% in the U.S. in 2024. Growth in Europe, meanwhile, is expected to pick up next year after a sluggish 2024.
Among emerging economies, the OECD said there were also signs of strength. In China, where the economy has struggled in part due to a protracted downturn in the property market, growth projections were revised upward slightly from earlier forecasts, which Pereira said was due to “stronger performance than in the recent past.”
The OECD said the global outlook was an indication that central banks’ efforts to quell inflation were working.
European markets close higher as traders assess possible rate cuts, fresh PMI data
- European markets closed higher on Monday as traders continued to assess the possibility of rate cuts after softer-than-expected U.S. jobs data.
- Friday’s U.S. nonfarm payrolls report showed 175,000 jobs were added in April, below the 240,000 jobs expected by economists surveyed by Dow Jones.
LONDON — European markets closed higher on Monday as traders continued to assess the possibility of rate cuts after softer-than-expected U.S. jobs data.
European markets
At market close the French CAC 40
was closed Monday for a public holiday and trading volumes were expected to be light.
Friday’s U.S. nonfarm payrolls report showed 175,000 jobs were added in April, below the 240,000 jobs expected by economists surveyed by Dow Jones.
The unemployment rate edged up to 3.9% from 3.8% in the prior month, according to the Bureau of Labor Statistics. Wage figures also came in lower than expected, an encouraging sign for inflation.
In Europe Monday, a S&P composite final purchasing managers’ index for the euro zone was released showing business activity in the bloc expanded at its fastest pace in almost a year. The index jumped to 51.7 for April, from 50.3 in March.
In individual stocks news, share of the e-commerce and mail firm PostNL
saw a 1.08% pop after posting an annual 27% sales rise for the month of April.
— CNBC’s Samantha Subin and Pia Singh contributed to this report.