Canada expected to lead G7 in economic growth, says OECD

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The Paris-based economic think tank says it now expects the Canadian economy to grow by 3.2 per cent this year, best in the G7.

Britain's decline, as seen by the OECD, is relative.

That is up from its forecast in June for growth of 2.8 per cent.

Its global growth forecast for this year was left at 3.5 percent for this year, but next year's was revised up by 0.1 percentage point to 3.7 percent.

"The short-term outlook is more broad-based and the upturn is promising, but there is no room for complacency", OECD Chief Economist Catherine L. Mann said in the statement.

The Organization for Economic Co-operation and Development (OECD) has raised its expectations for economic growth in Canada this year as part of its interim outlook on the global economy. Monetary policy should remain accommodative in some economies but with an eye on financial stability so as to remain supportive of further rebalancing towards fiscal and structural initiatives.

It maintained its Canadian outlook for 2018 at 2.3 per cent.

Growth among the major advanced economies remains on pace.

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Among economists at the other big four banks, National Australia Bank is predicting a rate rise in August 2018, followed by further rises to 2.5 per cent by the end of 2019.

In the United Kingdom, the previously identified growth slowdown is expected to continue through 2018, while uncertainty remains over the outcome of negotiations around the decision to leave the European Union.

Growth in Japan is expected to be 1.6 per cent this year and 1.2 per cent next year. That's 0.3 percentage point more than its previous prediction in June and means the region will match the expected growth rate of the US, which was left unchanged.

World growth was 3.1 per cent in 2016.

The downward revision was due to the transitory effects of demonetization and of the implementation of the Goods and Services Tax (GST), the group said.

The prediction of 1pc growth for UK GDP in 2018, in this interim update of economic outlooks, would still constitute the lowest level of growth in the UK economy since 2009, during a recession.

It also said China's strong growth has benefited emerging market economies.