The global economy is inching closer towards stability, with the impact of aggressive rate hikes by central banks starting to fade, according to the Organisation for Economic Cooperation and Development (OECD)’s latest economic forecast (pdf). The Paris-based organization revised its global growth forecast for 2024 to 3.2%, up 0.1 percentage points. The projection for 2025 was kept at the same level.

What’s driving the change? A combination of cooling inflation, recovering trade flows, and easing labor market pressures is boosting the economy and allowing central banks to begin to ease monetary policy. If the decline in oil prices persists, headline inflation could fall a further 0.5 percentage points lower than expected next year, the OECD says.

The big picture: Global growth is expected to stabilize despite geopolitical tensions and sluggish labor markets. The OECD now expects the UK economy to expand by 1.1% in 2024, up from its previous estimate of 0.4%, and by 1.2% in 2025, up 0.2% percentage points from its previous estimate. Growth in the euro zone is expected to nearly double from 0.7% growth this year to 1.3% in 2025, as incomes outpace inflation.

Meanwhile, the US and China are up for more modest slowdowns, with interest rate cuts expected to help cushion the US economy’s slowdown to 1.8% next year from 2.6% in 2024, up from a previous 2025 estimate of 1.6%.

The story got ink in Reuters and Bloomberg.

MARKETS THIS MORNING-

Asian markets are largely in the green, with China’s CSI 300 continuing a five-day streak of gains as investors cheer the economic stimulus package introduced by the government earlier this week. Japan’s Nikkei and South Korea’s Kospi are also both up 1.7%. Over on Wall Street, the Dow Jones broke its four-day streak of gains, with futures little changed this morning.

ADX

9,516

+0.6% (YTD: -0.6%)

DFM

4,489

+0.6% (YTD: +10.6%)

Nasdaq Dubai UAE20

3,917

+1.0% (YTD: +2.0%)

USD : AED CBUAE

Buy 3.67

Sell 3.67

EIBOR

4.6% o/n

4.1% 1 yr

TASI

12,344

+0.6% (YTD: +3.1%)

EGX30

31,251

+1.2% (YTD: +25.5%)

S&P 500

5,722

-0.2% (YTD: +20.0%)

FTSE 100

8,269

-0.2% (YTD: +6.9%)

Euro Stoxx 50

4,917

-0.5% (YTD: +8.8%)

Brent crude

USD 73.46

-2.3%

Natural gas (Nymex)

USD 2.64

+0.23%

Gold

USD 2,681.10

+0.2%

BTC

USD 63,439.50

-1.2% (YTD: +50.2%)

THE CLOSING BELL-

The DFM rose 0.6% yesterday on turnover of AED 353.3 mn. The index is up 10.6% YTD.

In the green: Al Salam Sudan (+7.2%), Drake & Scull International (+3.8%) and Parkin Company (+3.6%).

In the red: International Financial Advisors (-10.0%), Depa Limited (-7.6%) and Mashreqbank (-2.6%).

Over on the ADX, the index also rose 0.6% on turnover of AED 1.9 bn. Meanwhile Nasdaq Dubai closed up 1.0%

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