‘Full impact of tariff shock yet to come’, Pg15.

Key Highlights:

• The OECD reported that global growth is slowing slightly to 3.2% in 2025, from 3.3% last year.
• The OECD expects the full impact of US import tariffs is yet to be felt, with firms currently absorbing much of the shock.
• The OECD maintained its 2026 global growth forecast at 2.9%, anticipating higher tariffs to impact investment.

Detailed Insights:

• The OECD's Economic Outlook Interim Report indicates that AI investment is currently supporting economic activity in the US.
• Fiscal support measures are helping to mitigate the economic slowdown in China.
• The report suggests that the initial boost from inventory building is expected to diminish, contributing to the 2026 forecast remaining at 2.9%.

Key Concepts Involved:

• Tariff: A tax imposed by a government on imported or exported goods.
• Fiscal Policy: Government spending and taxation policies to influence the economy.
• Global Growth: The increase in the inflation-adjusted market value of goods and services produced by an economy over time.