Global Economic Forecast Upped
The Organisation for Economic Co-operation and Development (OECD) upped their 2021 and 2022 economic forecast due to the approved U.S. stimulus. This approval is expected to have a positive spillover effect on other economies. To be precise, the global economy is expected to grow a full percentage point. Think about the increased import (and perhaps even export) when $1.9 trillion is injected into the world’s largest economy. The OECD increased its 2021 global GDP forecast to 5.6% and its 2022 global GDP forecast to 4.0%. The U.S. GDP forecast increased to 6.5% and 4.0% respectively for the year 2021 and 2022.
The chart below gives a comparison of the projection made back in November 2019 versus the current baseline projection, the downside scenario, and the upside scenario. The OECD accentuated the fact that the global vaccine rollout is critical for economic recovery and an accelerated or decelerated rollout will have a direct effect on the recovery. The U.S. is the only country expected to fully recover from the pandemic by the end of 2021 according to the OECD.