OECD lifts 2026 global growth forecast to 2.9% despite Mideast war

The Paris-based OECD raised its 2026 global growth forecast to 2.9 percent, according to Business Recorder, a rise of 0.1 points from its June estimate. The group of 38 industrialised countries described growth as resilient in many economies despite the conflict in the Middle East.

Energy prices surged after US and Israeli attacks on Iran began last February. Even so, the organisation pointed to climbing share prices and ongoing credit availability as signs that financial conditions remain supportive. Large oil stockpiles, extra output from outside the Gulf and government support programmes softened the blow, the group said. It also highlighted heavy investment in artificial intelligence, which could lift output and trade above current projections.

Global growth nonetheless slowed sharply from 3.4 percent last year, and the 2027 forecast was trimmed by 0.1 percentage point to 3 percent. Governments have begun raising interest rates to curb inflation linked to costly oil and gas. This has pushed government bond yields to levels last seen during the 2007-2008 global financial crisis, raising borrowing costs. The OECD warned that inflation could persist if hostilities in the Middle East continue, with G20 price increases seen at 4.1 percent this year.