OECD growth slows to 0.1% in Q1 2025 amid G7 divergence

Within the G7 group, overall GDP growth also decelerated to 0.1 per cent from 0.4 per cent in the previous quarter, reflecting divergent trends among member economies. Japan and the United States saw contractions of -0.2 per cent and -0.1 per cent, respectively. A surge in imports—particularly in the US, where goods imports jumped by 10.8 per cent, likely in anticipation of tariff changes—was a key drag on growth, the OECD said in a press release.

OECD GDP growth slowed sharply to 0.1 per cent in Q1 2025 from 0.5 per cent in Q4 2024, with the G7 showing a mixed picture.
Japan and the US saw contractions, while the UK led growth at 0.7 per cent, driven by strong investment and exports.
Among other OECD members, Ireland posted the highest growth at 3.2 per cent, while Slovenia saw the largest decline.

Canada’s GDP growth eased slightly to 0.4 per cent, while several European economies showed modest improvement. The United Kingdom recorded a strong rebound, with growth accelerating to 0.7 per cent, fuelled by rising investment and exports. Germany and France returned to positive territory, with GDP rising by 0.2 per cent and 0.1 per cent, respectively, and Italy posted a slight uptick to 0.3 per cent.

Outside the G7, 17 OECD economies experienced slower growth compared to the previous quarter. Slovenia saw the steepest quarterly contraction at -0.8 per cent, followed by Portugal at -0.5 per cent. Ireland stood out with a robust 3.2 per cent growth rate, the highest in the OECD for the quarter.

On a year-on-year basis, OECD GDP grew by 1.6 per cent in Q1 2025, down from 1.9 per cent in the final quarter of 2024. Among G7 nations, Canada led with 2.3 per cent annual growth, followed by the US at 2.0 per cent. Germany recorded the largest annual decline, at -0.2 per cent.

Fibre2Fashion News Desk (KD)