(MENAFN- Kuwait News Agency (KUNA)) Global economic growth will firm in 2015 and 2016 more than previously predicted because of weaker oil prices and softer monetary policies in the major economies worldwide, the Organisation for Economic Cooperation and Development (OECD) said in a report Wednesday.
But "the short-term rhythm of growth remains modest with the backdrop of inflation and interest rates that are abnormally low, which reveals the existence of financial instability risks," the OECD warned.
Spurred on by domestic demand and a rising US dollar, growth in the United States is set to be relatively robust over the next 18 months and this will have a ripple effect on global demand.
The report here forecasts that US economic growth will be around 3.1 percent this year and 3.0 percent in 2016.
At the same time, GDP is projected to expand by 2.6 percent in Britain in 2015 and by 2.5 percent the following year.
Canadian growth is forecast to be 2.2 percent and 2.1 percent in the same period, while the Japanese economy should expand by 1.0 percent this year and 1.4 percent in 2016, the report said.
The Euro Zone will also benefit from increased trade and activity due to the weaker Euro which has lost close to 20 percent of its value in six months.
Eurozone growth is forecast by the OECD to reach 1.4 percent in 2015 and 2.0 percent in 2016, with both German and French growth showing signs of good recovery.
For non-OECD emerging economies, China is expected to record an average of 7.0 percent economic expansion for the next two years and Indian growth should reach 7.7 percent this year and 8.0 percent in the following 12-month period.
Despite the better figures, the OECD "warned against any self-satisfaction" and cautioned governments against "excessively" using monetary policy without promoting industrial investments.
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