PARIS, FRANCE / RankWire.AI / – The OECD has increased its projection for global growth in 2026 to 2.9%, citing the resilience of the world economy surpassing expectations. This revision marks an increase from 2.8% in the organization’s June forecast. Nonetheless, the OECD lowered its 2027 outlook to 3.0% from 3.1%. Continued investment in artificial intelligence-driven sectors has been a key factor supporting production, trade, and economic activity. Meanwhile, rising energy prices and inflationary pressures remain significant challenges across major economies.
According to the September Interim Economic Outlook, global growth experienced a slowdown during the first half of 2026. The annualized growth rate dropped to 2.6%, compared to 3.6% in the latter half of 2025. Despite this deceleration, economic activity in many energy-importing and exporting nations proved stronger than anticipated. Factors such as oil inventories, additional production outside the Gulf, and alternative supply routes helped mitigate the energy shock. Reduced oil demand from China also contributed to stabilizing global energy markets.
The OECD highlighted that technology investments continue to serve as a vital source of economic momentum. Exports of semiconductors surged notably in Korea and Japan, while China also registered increased technology exports. Industrial output associated with technology maintained rapid expansion across much of Asia. Similar growth patterns emerged in the United States and several European nations. Consumer confidence improved in advanced economies after May, and unemployment rates stayed low in many regions. However, persistent higher fuel prices continued to strain household purchasing power.
US Economy Gains Strength as the Eurozone Remains Weak
The US economy is projected to expand by 2.2% in 2026 and 2.1% in 2027. Robust investments related to artificial intelligence support growth, but restrained consumer spending and sluggish real income growth limit overall progress. The euro area’s GDP is expected to grow 1.0% in both years, facing headwinds from rising energy costs and interest rates that dampen activity. Japan is forecast to grow 0.8% in 2026, with a slight slowdown to 0.7% in 2027.
China’s economy is anticipated to grow 4.5% in 2026 before decelerating to 4.2% in 2027. India is expected to expand by 7.1% in fiscal year 2026-27, following 7.8% in the previous fiscal year, with a forecast of 6.5% for 2027-28. Indonesia’s growth is projected at 5.2% in 2026 and 5.1% in 2027. Mexico’s economy is forecast to grow 1.5% this year and 1.8% in the following year.
Energy Cost Pressures Drive G20 Inflation Higher
Inflation continues to be a key concern in the OECD outlook. G20 economies are expected to see headline inflation reach 4.1% in 2026, up from 3.4% in 2025, with a decrease to 3.6% anticipated in 2027. Inflation in advanced G20 nations is projected at 3.2% in 2026 and 2.6% in 2027. The United States’s rate is expected to fall from 3.6% in 2026 to 2.6% in 2027. Meanwhile, inflation in the euro area is forecast at 3.0% and 2.9% respectively.
Rising energy prices have elevated household expenses and renewed inflationary pressures in many economies, the OECD noted. Additionally, long-term government bond yields have increased as borrowing costs and debt servicing obligations rise. OECD Secretary-General Mathias Cormann commented that global growth has fared better than expected, though the economy remains weaker than last year. The organization recommended targeted temporary assistance, sustainable public finances, and stronger long-term productivity. It also called on governments to enhance skills, diversify energy supplies, and promote broader adoption of artificial intelligence.