OECD GDP growth rebounds to 0.4% in Q2 2025

Gross domestic product (GDP) in the Organisation for Economic Co-operation and Development (OECD) rose by 0.4 per cent in the second quarter (Q2) of 2025, up from 0.2 per cent in Q1, according to provisional estimates. This reflects a return to the stable growth levels of 0.4–0.5 per cent seen in earlier quarters. A similar rebound was recorded in the G7 economies, where GDP accelerated from 0.1 per cent to 0.4 per cent, though contributions varied widely across member nations.

The United States made the largest contribution to OECD growth, with GDP rebounding by 0.7 per cent in Q2 after a 0.1 per cent contraction in Q1. This recovery was mainly driven by a sharp 10.3 per cent drop in goods imports, following an 11 per cent surge in Q1 linked to anticipated tariff changes, OECD said in a release.

However, liquidation of inventories built up earlier weighed on growth. France and Japan also posted modest improvements, each rising from 0.1 per cent to 0.3 per cent.

By contrast, momentum faltered elsewhere in the G7. Canada’s GDP stalled after 0.5 per cent growth in Q1, while the United Kingdom slowed to 0.3 per cent from 0.7 per cent, dragged down by a 1.1 per cent contraction in investment. Germany and Italy slipped into negative territory, with GDP shrinking by 0.3 per cent and 0.1 per cent, respectively. Germany’s contraction was largely driven by a decline in goods exports, which fell 0.6 per cent after surging 3 per cent in Q1.

Across the broader OECD, results were mixed. Of the 23 countries with available data, 13 posted higher growth compared with Q1. Ireland recorded the steepest slowdown, contracting by 1 per cent after a remarkable 7.4 per cent surge in Q1 on strong exports to the US. Denmark, meanwhile, saw a sharp turnaround, shifting from a 1.3 per cent contraction to 1.3 per cent growth.

On a year-on-year basis, OECD GDP growth remained steady at 1.7 per cent. Among the G7, the US recorded the strongest annual expansion at 2 per cent, while Germany posted the weakest at just 0.2 per cent.

ALCHEMPro News Desk (HU)