The Organisation for Economic Co-operation and Development (OECD) has revised down its economic growth forecast for Indonesia this year, lowering it from 5.2% to 4.9%. The growth projection for next year has also been reduced from 5.1% to 5%. 

In its March 2025 Economic Outlook, the OECD also cut its global economic growth forecast for this year from 3.3% to 3.1%. The global growth forecast for next year was also lowered, from 3.1% to 3%. 

"Economic growth in emerging G20 countries is generally expected to slow down," as cited from the OECD Economic Outlook, March 2025, on Tuesday, March 18, 2025. 

The OECD estimates that China’s economy will grow by only 4.8% this year and 4.6% next year due to the negative impact of U.S. President Donald Trump’s tariff policies. In India, GDP growth is projected at 6.4% for the 2024-2025 fiscal year and 6.6% for the 2025-2026 fiscal year. 

Brazil’s economic expansion is also expected to slow down from its recent rapid pace due to the impact of tighter monetary policies and higher tariffs on steel and aluminum exports to the U.S., weakening growth from 3.4% in 2024 to 2.1% in 2025 and 1.4% in 2026. 

Global Inflation Down, Indonesia Up 

The OECD predicts that global inflation will be lower this year and next year compared to last year. The headline inflation rate in G20 countries is projected to decrease from 5.3% in 2024 to 3.8% in 2025 and 3.2% in 2026, with core inflation in advanced G20 countries projected to be 2.7% in 2024, 2.6% in 2025, and 2.4% in 2026. 

Quarterly projections suggest that core inflation will remain above the central bank’s inflation target at the end of the projection period in more than half of the advanced G20 countries, including the U.S. Meanwhile, annual inflation in emerging countries is expected to decrease more significantly than in developed countries, mainly reflecting further significant declines in inflation in Argentina and Turkey from very high levels in 2024. 

However, headline inflation in some other developing countries, including South Africa, China, and Indonesia, is projected to increase. 

This article is published in partnership with Katadata 

Original article here