The Organization for Economic Cooperation and Development lifted its growth forecasts for Germany, France and the U.K. while urging the region’s most-indebted nations to step up changes to improve competitiveness.
Germany will expand 0.7 percent this year instead of the 0.4 percent predicted in May, while France will grow 0.3 percent instead of shrinking 0.3 percent as previously predicted, the Paris-based organization said in an interim report published today.
Growth in the U.K., which isn’t part of the euro bloc, will be 1.5 percent, instead of the 0.8 percent forecast in May. Europe’s economic revival comes in the face of slower growth elsewhere, especially in emerging markets.
Policy makers need to stand ready to support demand should the recovery falter, said the OECD, which advises its 34 member governments on economic policy.
“In the euro area, re-balancing remains incomplete with weak domestic demand in high debt countries having been offset by stronger exports only to a limited extent,” the OECD said.
“Supportive monetary conditions must be maintained, while scope for further monetary easing remains if the recovery were to fail to take hold.”
Italy, the third-largest euro-area economy, stands out for showing little signs of recovery, according to the OECD.
Italian gross domestic product will probably shrink 1.8 percent this year, the OECD said, maintaining its May forecast. In the U.S., the world’s largest economy, 2013 GDP will expand 1.7 percent instead of the 1.9 percent predicted in May, the OECD said.
China’s expansion will be 7.4 percent instead of the 7.8 percent previously predicted.
“Growth in China has seemingly already passed the trough and looks set to recover further in the second half,” the OECD said.
“In a number of other emerging economies, the recent financial market tensions and weak momentum suggest both a reappraisal of trend growth and deterioration in cyclical conditions.”
bloomberg.com
Germany will expand 0.7 percent this year instead of the 0.4 percent predicted in May, while France will grow 0.3 percent instead of shrinking 0.3 percent as previously predicted, the Paris-based organization said in an interim report published today.
Growth in the U.K., which isn’t part of the euro bloc, will be 1.5 percent, instead of the 0.8 percent forecast in May. Europe’s economic revival comes in the face of slower growth elsewhere, especially in emerging markets.
Policy makers need to stand ready to support demand should the recovery falter, said the OECD, which advises its 34 member governments on economic policy.
“In the euro area, re-balancing remains incomplete with weak domestic demand in high debt countries having been offset by stronger exports only to a limited extent,” the OECD said.
“Supportive monetary conditions must be maintained, while scope for further monetary easing remains if the recovery were to fail to take hold.”
Italy, the third-largest euro-area economy, stands out for showing little signs of recovery, according to the OECD.
Italian gross domestic product will probably shrink 1.8 percent this year, the OECD said, maintaining its May forecast. In the U.S., the world’s largest economy, 2013 GDP will expand 1.7 percent instead of the 1.9 percent predicted in May, the OECD said.
China’s expansion will be 7.4 percent instead of the 7.8 percent previously predicted.
“Growth in China has seemingly already passed the trough and looks set to recover further in the second half,” the OECD said.
“In a number of other emerging economies, the recent financial market tensions and weak momentum suggest both a reappraisal of trend growth and deterioration in cyclical conditions.”
bloomberg.com
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