The world economy is headed for an earlier recovery than previously forecast, although the pace of the rebound will likely remain modest for some time to come, the OECD says.
The Paris-based organisation of industrialised nations said recessions this year in Japan and the euro zone would be less severe than the organisation forecast in June, while the outlook for the US was stable.
Presenting the interim outlook at a news conference in Paris on Thursday, the OECD’s top economist Jorgen Elmeskov cited improving financial conditions, a rebound in trade and an end to inventory destocking by industry as factors pointing to faster economic recovery in the OECD’s 30 member countries.
However, the recovery remained fragile, Elmeskov said.
“Recovery looks to be at hand for the OECD economy at large, but it’s important not to get carried away,” Elmeskov said.
“The green shoots need careful nurturing by policy if they are to become strong sustainable plants.”
Elmeskov said the recovery would probably be bumpy, with ups and downs.
“There’s not a letter in our alphabet that really describes the shape of the recovery we forecast,” Elmeskov said.
“It will be something between and L and a V,” he added.