International Econ Organization Raises Forecast

Paris, France, June 24, 2009--The Organization for Economic Cooperation and Development raised its forecast for the economy of its 30 member nations for the first time in two years as the U.S. slump shows signs of easing.

The combined economy of the world’s most-industrialized countries will shrink 4.1 percent this year and grow 0.7 percent in 2010, the Paris-based group, which was founded in 1961 to coordinate international economic policies, said. The new projections compare with March forecasts for contractions of 4.3 percent and 0.1 percent.

The improved outlook conflicts with that of the World Bank, which this week said the global recession will be deeper than it predicted three months ago.

The U.S. economy was largely responsible for the OECD’s prediction that the global recession will reach its bottom in the second half of this year. The world’s largest economy will contract 2.8 percent this year and grow 0.9 percent next year, the organization said in revising its forecast from declines of 4 percent in 2009 and zero growth in 2010.

“Signs have multiplied that U.S. activity could bottom out in the course of the second half of this year,” Jorgen Elmeskov, the OECD’s acting chief economist, said.