Shocking New OECD Forecasts Reveal: Australia Set for Growth Surge as Global Giants Stall in 2025
OECD forecasts show Australia at the forefront of global growth through 2025, outpacing the US, UK, and China despite recent turmoil.
- Australia’s GDP projected to rise 1.8% in 2025—outpacing US, UK, and Canada
- Extreme weather shaved $2.2 billion off the Aussie economy in early 2025
- Global growth will slow to 2.9% in 2025, G20 economies hit the brakes
- China’s boom softens—growth down to 4.7% amid global headwinds
Australia is defying global economic gravity. As giants like the US, China, and Europe slow, the OECD predicts Australia will accelerate out of the slowdown, bouncing back from a gloomy start to 2025 and shaking off headwinds from trade wars and wild weather.
How Is Australia Surging Ahead When Other Economies Stall?
Heavy rains, floods, and Cyclone Alfred battered Australia’s economy at the start of 2025—costing an estimated $2.2 billion and stalling growth to just 0.2% in the March quarter. Mining, tourism, and shipping all took a hit.
But don’t despair—the world’s most trusted economic forecaster, the OECD, now tips Australia’s economy to grow by a sturdy 1.8% in 2025. That’s well above the OECD average of just 1.4%, leaving major peers like the UK, Canada, and South Korea trailing at only around 1%.
Recent figures from the Australian Bureau of Statistics confirm domestic growth remains modest, with household consumption still soft and public infrastructure spending winding down. But economists say the private sector is poised to take the baton, especially as energy bill relief unwinds and state construction activity shifts gears.
Q: What’s Dampening Global Growth—And How Does Australia Escape the Worst?
Many world powers are limping along:
– The US will slow to 1.6% growth after Donald Trump’s unpredictable trade wars and sweeping import tariffs rattle businesses and consumers alike.
– The UK and Canada expect around 1% growth.
– Europe’s 20-nation eurozone hopes for a tepid 1% after barely climbing in 2024.
– China’s juggernaut economy is cooling—projected at 4.7% next year and just 4.3% in 2026.
The culprit? Surging trade barriers, escalating tariffs (like Trump’s 10% hit on most imports), and uncertainty about further global trade retaliation have paralyzed investment and sapped confidence worldwide.
Australians, meanwhile, benefit from still-robust trade ties—beef exports to the US remain strong despite tariffs. The economy is weathering storms both literal and figurative, with cautious consumers expected to loosen purse strings as real disposable incomes improve later this year.
How Will Australia’s Economy Rebound in the Second Half of 2025?
Analysts see a rally ahead. The fading sting of natural disasters, coupled with the passing of one-off shocks, points to a bounce in housing, consumer spending, and private-sector investment.
Treasurer Jim Chalmers promises fresh momentum from the private sector as government spending winds down, betting on a robust handover despite a “shaky” start.
Senior economists at leading banks, including Commonwealth Bank and Westpac, flag a likely uptick as public spending gives way to renewed domestic and international demand.
Q: What Are the Big Global Economic Takeaways for 2025 and 2026?
– Global G20 growth is slowing to 2.9% in 2025 and will stay flat into 2026.
– The world economy’s steady expansion remains under threat from ongoing trade battles and policy uncertainty.
– Despite a tough global environment, Australia is tipped to grow 2.2% in 2026—again beating the 1.5% global average.
What Should Australians Watch Now?
– Watch for improved household incomes and a pick-up in private sector confidence later in the year.
– Monitor shifting trade dynamics, especially if US import tariffs intensify or global alliances shift.
– Look out for renewed government efforts to support business, infrastructure, and resilience against future extreme weather events.
Ready to Make the Most of Australia’s Economic Edge?
- Track real household income trends and get prepared to spend smart later in 2025.
- Stay alert to new developments from the OECD, ABS, and international policy shifts.
- If in business: assess how tariffs or global demand for Australian exports could impact your sector.
- Watch for government and banking updates on private sector growth stimulus.
Stay informed, stay nimble—and get ready to ride the wave as Australia forges ahead in 2025!