OECD Hikes Global Growth Forecast for 2023, 2024

An employee works on the production line of a tyre factory under Tianjin Wanda Tyre Group, which exports its products to countries such as US and Japan, in Xingtai, Hebei province, China May 21, 2019. REUTERS/Jason Lee
An employee works on the production line of a tyre factory under Tianjin Wanda Tyre Group, which exports its products to countries such as US and Japan, in Xingtai, Hebei province, China May 21, 2019. REUTERS/Jason Lee
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OECD Hikes Global Growth Forecast for 2023, 2024

An employee works on the production line of a tyre factory under Tianjin Wanda Tyre Group, which exports its products to countries such as US and Japan, in Xingtai, Hebei province, China May 21, 2019. REUTERS/Jason Lee
An employee works on the production line of a tyre factory under Tianjin Wanda Tyre Group, which exports its products to countries such as US and Japan, in Xingtai, Hebei province, China May 21, 2019. REUTERS/Jason Lee

The global economic outlook has improved from a few months ago as the inflation shock eases but rising interest rates will keep risks high, the OECD said on Friday, hiking its growth forecasts for major economies.

After growth last year of 3.2%, the world economy is on course to expand 2.6% as central bank tightening takes full effect, the Organization for Economic Cooperation and Development said in its interim economic outlook.

The Paris-based organization raised its forecast for global growth from 2.2% in its last Economic Outlook in November, citing a decline in energy and food prices and China's easing of its anti-COVID restrictions.

Looking to next year, global growth was expected to accelerate to 2.9% - compared with a November forecast of 2.7% - as the hit to household incomes from high energy prices faded, Reuters reported.

The OECD forecast that inflation in the Group of 20 major economies would fall from 8.1% last year to 5.9% this year and further decline to 4.5% in 2024 - still well above targets despite interest rate hikes by many central banks.

It said the full impact of higher interest rates was hard to gauge, warning that increased stress for borrowers could translate into losses for some banks, citing the recent collapse of Silicon Valley Bank in the United States as an example.

Setting aside turmoil in financial markets following SVB's failure and continued worries about Swiss lender Credit Suisse, the European Central Bank hiked interest rates by a further half percentage point on Thursday to fight inflation.

The OECD projected that central bank policy rates would peak at 5.25-5.5% in the United States and 4.25% in the euro area and Britain with a decline in inflation possibly allowing for a "mild" easing next year.

The OECD forecast that US economic growth would slow from 1.5% this year to 0.9% next year as higher interest rates cooled demand. With the US labour market holding up better than expected, the forecast for this year was up from 0.5% in November and down from 1.0% for 2024.

Boosted by the easing of anti-COVID measures, the Chinese economy was seen growing 5.3% this year and 4.9% in 2024, up from November forecasts for 4.6% and 4.1% respectively.

The outlook for the euro area had also improved thanks to a drop in energy prices with the 20-nation bloc expected to see growth this year of 0.8% followed by 1.5% in 2024. The OECD had previously forecast 0.5% and 1.4% growth respectively.



Saudi Sovereign Fund Grows Assets 19% to $913 Billion

The Saudi capital, Riyadh (Reuters) 
The Saudi capital, Riyadh (Reuters) 
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Saudi Sovereign Fund Grows Assets 19% to $913 Billion

The Saudi capital, Riyadh (Reuters) 
The Saudi capital, Riyadh (Reuters) 

Saudi Arabia’s Public Investment Fund (PIF) has continued to cement its role as a driving force behind the Kingdom’s economic transformation, posting record growth in managed assets and strong financial results in its 2024 annual report.

The figures show the fund now contributes 10% of Saudi Arabia’s non-oil GDP, with managed assets reaching SAR 3.42 trillion ($913 billion) and more than $171 billion invested in priority sectors since 2021.

According to the report, released Wednesday, PIF’s managed assets rose 19% year-on-year to SAR 3.42 trillion by the end of 2024, generating an average annual shareholder return of 7.2% since 2017. Revenues climbed 25% over the same period. Liquidity and cash positions remained stable, with the fund maintaining a robust balance sheet.

The report highlighted substantial progress in delivering on the fund’s strategic investment targets, reinforcing its status as one of the largest and fastest-growing sovereign wealth funds in the world. PIF’s cumulative contribution to non-oil GDP from 2021 to 2024 reached SAR 910 billion, with an expected total impact of SAR 1.2 trillion by the end of this year.

PIF Governor Yasir Al-Rumayyan said 2024 marked “a new and promising phase of exceptional performance and qualitative innovation,” characterized by the systematic integration of artificial intelligence, smart automation, and advanced digital capabilities across all operations. He noted that this shift represents not just technological advancement, but a “transformational approach” in how PIF invests, operates, and delivers economic and social impact globally.

For his part, Chief Financial Officer Yasir Alsalman reported that SAR 213 billion were directed to priority sectors in 2024 alone, bringing total investments in such sectors since 2021 to over 642 billion riyals.

In turn, Acting Chief Operating Officer and Board Secretary General Maram Al-Johani said PIF maintained its long-term vision while strengthening its influence locally and internationally, continuing to lead Saudi Arabia’s economic diversification and generate sustainable returns.

The fund’s international portfolio expanded further in 2024, targeting sustainable returns through long-term investments and strategic partnerships in key global markets. PIF’s overseas investments aim to diversify assets and income streams, secure partnerships with major corporations and investors, and back advanced technologies that support Saudi Arabia’s economic ambitions and shape the future global economy.

PIF diversified its funding base in 2024, securing SAR 36.855 billion ($9.83 billion) in public loans and nearly SAR 26 billion ($7 billion) in private loans. The fund’s stability has earned global recognition, with Moody’s upgrading its credit rating from A1 to Aa3 in 2024, and Fitch affirming its A+ rating with a “stable” outlook.

Governance standards also drew praise. PIF scored 96% in the 2024 Governance, Sustainability and Resilience Index from Global SWF — a sharp improvement over 2021 — and ranked first worldwide among 200 sovereign investors, achieving 100% compliance in 2025. It also topped the global list of most valuable sovereign wealth fund brands, with a valuation exceeding SAR 4.13 billion, earning an A+ rating from Brand Finance.