OECD cuts eurozone growth forecasts
The world's developed economies will see gradually stronger growth from the middle of this year, an international organisation has said.
The OECD, which represents 34 advanced economies, forecast average growth of 1.2% this year and 2.3% in 2014.
But it warned of a gap between fast-growing members, such as the United States, and the eurozone, which will continue to struggle.
It said the UK would grow by 0.8% this year and 1.5% next year.
The forecasts came in the OECD's twice-yearly Economic Outlook publication.
"While still disappointing, the global economy is moving forward, and it is doing so at multiple speeds," said Pier Carlo Padoan, the OECD's deputy secretary general, and the organisation's chief economist.
Austerity effect
The OECD said the UK economy continued to face "strong headwinds" although economic problems had not hit the jobs market as badly as had been expected.
It said the government's austerity plans had affected growth, but said the measures were "necessary" and warned that "further fiscal consolidation" was needed.
The organisation painted a troubled picture of the eurozone economy, which it expects to shrink by 0.6% this year.
It blamed austerity measures, weak confidence and tight credit conditions. It hinted that the European Central Bank (ECB) may want to expand quantitative easing (QE) as a measure to encourage stronger growth.
In contrast it said the pace of QE in the United States may need to be "gradually reduced", where growth of nearly 2% is forecast for this year.
Japan is forecast to have the strongest growth of the major OECD economies this year, adding 1.6% to its GDP on the back of extraordinary economic stimulus measures introduced by the government this year.
But the OECD said there was considerable uncertainty over whether that recovery would continue into 2014, when the government is expected to cut spending.
China is not included in the OECD club, but the organisation expects its annual growth to be at around 8% over the next two years.
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