OECD increased global economic growth forecast, said- banks in distress due to strict monetary policy

OECD on Global Economy: In the midst of the global crisis, the OECD (Organisation for Economic Co-operation and Development) has increased the estimate of the global economic growth rate. The OECD believes that after the reduction in inflation and the end of the restrictions imposed on Corona in China, global economic growth can accelerate. The OECD expects the global economy to grow at 2.6 per cent in 2023. Earlier he had estimated 2.2 percent in November 2022.

In 2023, the OECD believes that the global economy growth rate can be 2.6 percent, but it is less than in 2022. In 2022, 3.2 percent growth rate was seen. Paris-based OECD has said these things in its updated Economic Outlook A Fragile Recovery. OECD said in the report, improvement in business and consumer sentiment is visible. There are now more positive signs with food and energy prices falling and China fully reopening.

However, the OECD warned that the outlook is still fragile. The risk has reduced to some extent. The report talks about uncertainty due to the war in Ukraine, the risk of renewed pressure on energy markets and the impact of rising interest rates. Central banks around the world have made loans costlier to control inflation. The OECD said that the market fears that due to rising interest rates, economies may go into recession.

According to the report, the effect of strict monetary policy has started appearing on the banking sector, especially on the banking sector of America. High interest rates can have a more severe impact on the economic development of the country than expected. Due to the strict monetary policy, the banking crisis has deepened and the Silicon Valley Bank has gone bankrupt.

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