OECD cuts world growth forecast

November 19, 2013: 8:34 AM ET
oecd slashes global growth forecasts
The OECD also trimmed its growth forecasts for China, the world's second biggest economy, to 7.7% in 2013 and 8.2% next year.
LONDON (CNNMoney)

Another month, another downgrade for the world economy, this time from the Organization for Economic Co-operation and Development.

The OECD on Tuesday cut its forecast for global growth in 2013 due to a deterioration in emerging markets.

The group now expects the world economy to expand by 2.7% this year, compared with its May forecast of 3.1%. It also cut its 2014 growth outlook to 3.6% from 4.0%.

"The recovery is real, but at a slow speed, and there may be turbulence on the horizon," OECD Secretary General Jose Angel Gurría said in a statement.

Angel Gurria said the OECD was concerned about the possibility of another round of political brinkmanship in the U.S.

The Federal Reserve's plans to eventually wind down its stimulus program could also bring a renewed bout of instability, he said.

Related: A stumble in Asia would mean a big hit to the world

The International Monetary Fund downgraded its forecasts for global growth last month, blaming the weaker-than-expected expansion in emerging markets.

The OECD's latest forecast is even weaker than the IMF's prediction of growth of 2.9% this year.

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But there were some bright spots in the OECD report. The group expects Chile, Turkey, Mexico, Korea and Israel will continue delivering impressive growth, outpacing other economies over the next few years.

The OECD also issued a new forecast for 2015, predicting a slight acceleration in growth to 3.9%.

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