1. GENERAL ASSESSMENT OF THE MACROECONOMIC SITUATION OECD ECONOMIC OUTLOOK, VOLUME 2014/2 © OECD 2014 – PRELIMINARY VERSION10 Summary

● Growth is projected to remain modest by past norms, and unemployment is set to stay much above pre-crisis levels in many economies. Prospects for moderate improvements differ across both advanced and emerging economies. – In the advanced economies, growth is set to be stronger in the United States and the United Kingdom than in the euro area and Japan. Unemployment will remain particularly high in the euro area. – In the emerging market economies, growth will edge down in China, remain weak in Russia and Brazil, but will recover steadily in India, Indonesia and South Africa. ● World trade growth is expected to pick up a bit, with trade intensity growing again after the stagnation in recent years, but at a slower rate than prior to the crisis. ● Risks to GDP growth in the coming two years are on the downside due to potential financial volatility, lack of confidence about future growth prospects, and impaired and stretched balance sheets of banks and households. The euro area is particularly strongly exposed to these negative risks. ● Inflation is likely to remain below target inmany OECD economies due to persistent slack and the recent sharp falls in oil and food prices, even if the latter will cushion growth. The euro area is at risk of deflation if growth stagnates or if inflation expectations fall further