The OECD revised its 2026 global growth outlook upward on Wednesday, pointing to strong investment in artificial intelligence as a factor helping to offset the economic drag from ongoing energy disruptions linked to the conflict in the Middle East. The world economy is now expected to expand by 2.9% in 2026, a slight increase from the 2.8% rate anticipated in June. Projections for 2027 were trimmed to 3.0%, down from an earlier estimate of 3.1%.
Projected G20 inflation has been nudged upward to 4.1% for 2026, compared with a June forecast of 4.0%, while the 2027 outlook now stands at 3.6%, revised higher from an earlier projection of 3.1%. Forecasts put G20 core inflation at 2.7% for 2026, easing further to 2.5% the following year.
The organisation, headquartered in Paris, noted that robust investment flows into artificial intelligence have helped underpin worldwide output, commerce, and expansion, even as pressures on energy markets persist. A projected easing of energy prices in 2027, as supply levels recover, is anticipated to provide further support for growth stability.
The OECD also identified potential headwinds for the outlook, noting in its report that a further rise in long-term sovereign bond yields or lower-than-anticipated returns on artificial intelligence investment could weaken growth prospects and prompt a repricing of financial assets. Elevated borrowing costs, subdued real wage gains, and stubbornly high energy bills were among the headwinds identified as potential drags on expansion across a number of economies.
Forecasters raised their outlook for the American economy to 2.2% expansion next year, up from the previous June projection, tapering to 2.1% the year after, as robust artificial intelligence investment helps counterbalance softer household spending. Forecasts place the rate of price growth at 3.6% for 2026, declining to 2.6% the following year. Forecasts point to the economy expanding at 4.5% this year, with the pace easing to 4.2% by 2027.
Revised growth projections for Canada show the 2026 rate trimmed to 0.9% from a prior estimate of 1.2%, and the 2027 figure adjusted down to 1.3% from 1.7%, following the introduction of US tariffs on Canadian exports.
On Wednesday, crude oil hovered near $91 per barrel, extending a five-session decline after President Trump described talks between US officials and Iranian envoys as productive, adding that negotiations were gaining traction toward an agreement. Speaking before the UN General Assembly, Trump outlined what he described as a consequential choice between diplomatic negotiations with Iran and a more assertive course of action, and expressed the view that an agreement would probably materialise after the US midterm elections.
Iran's written proposal — which includes restarting negotiations toward a lasting end to the conflict — has been formally delivered to the United States, according to a high-ranking Iranian official. According to reports from a prominent television network, Iran put forward a proposal to restore access through the Strait of Hormuz within a week, contingent on the removal of restrictions on its ports by the United States.
In a separate development, Saudi Arabia has moved to restore operations on its East-West pipeline, which was shut down following drone strikes earlier this month, with oil exports potentially set to resume by the end of the week.
