Rising interest rates bodes ill for global economy

Frankfurt (Germany): The global economy must steer through a precarious recovery this year and next as inflation keeps dragging on household spending and higher interest rates weigh on growth, banks and markets. That was the takeaway Wednesday from the latest economic outlook by the Paris-based Organization for Economic Cooperation and Development (OECD). The group, made up of 38 member countries, raised its growth forecast this year to 2.7 per cent from an estimated 2.2 per cent in November and foresaw only a tiny acceleration to 2.9 per cent next year. The rebound from the Covid-19 pandemic and energy price spike tied to Russia’s invasion of Ukraine is likely to be weak by past standards, with average growth of 3.4 per cent recorded in the pre-pandemic years 2013-2019.