Global Economy to Grow 3.2% in 2025 Despite U.S. Trade War, OECD Reports
- Chalani Himasha
- 6 hours ago
- 2 min read
Himasha Dissanayake, JadeTimes Staff
H. Dissanayake is a Jadetimes news reporter covering Economy
Image Source: Poland insight
The global economy is demonstrating unexpected resilience in the face of the United States’ ongoing trade war, with the Organization for Economic Cooperation and Development (OECD) projecting 3.2% growth for this year. Alt text: OECD forecasts resilient global growth in 2025 despite U.S.–China trade tensions.
In its latest outlook released Tuesday, the OECD upgraded its projections for both global and U.S. economic performance. While the 2025 forecast remains slightly below the 3.3% expansion recorded in 2024, it represents a clear improvement from the 2.9% initially predicted in June. The organization anticipates global growth will moderately ease to 2.9% next year.
The U.S. economic forecast also received a boost, with expected growth rising to 2%, up from the previous estimate of 1.6%. Nevertheless, this is slower than the strong 2.8% expansion seen in 2024. President Donald Trump’s return to office and the subsequent overhaul of trade policy — including new import tariffs — were widely expected to weigh on economic momentum. However, the tariffs implemented were milder than earlier threats, and many firms accelerated imports to avoid the levies. Furthermore, massive global investments in artificial intelligence continue to provide a significant economic tailwind.
OECD Secretary-General Mathias Cormann noted that resilience has prevailed despite concerns about slowing growth amid higher trade barriers and uncertainty. Still, he cautioned that rising tariffs will “gradually feed through to higher prices,” potentially reducing household spending and business investment over time.
China’s economy is expected to maintain 5% growth this year, matching its 2024 performance. The eurozone is projected to grow 1.3% in 2025, an improvement from last year’s subdued 0.8% expansion. India, now the fastest-growing major economy, is forecast to accelerate to 6.7% growth this year, up from 6.5% in 2024.
Overall, the OECD’s updated outlook highlights a global economy that continues to outperform expectations despite escalating protectionism and geopolitical headwinds.
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