OECD forecast: High rates and inflation to slow world growth

Hobbled by high-interest rates, punishing inflation and Russia’s war against Ukraine, the world economy is expected to eke out only modest growth this year and to expand even more tepidly in 2023. 

That was the sobering forecast issued Tuesday by the Paris-based Organization for Economic Cooperation and Development. In the OECD's estimation, the world economy will grow just 3.1% this year, down sharply from a robust 5.9% in 2021. 

Next year, the OECD predicts, will be even worse: The international economy will expand only 2.2% in 2023, it estimates. 

The OECD, made up of 38 member countries, works to promote international trade and prosperity and issues periodic reports and analyses. In its latest forecast, the organization predicts that the Federal Reserve’s aggressive drive to tame inflation with higher interest rates — it’s raised its benchmark rate six times this year, in substantial increments — will grind the U.S. economy to a near-halt. It expects the United States, the world's largest economy, to grow just 1.8% this year (down drastically from 5.9% in 2021), 0.5% in 2023 and 1% in 2024.