OECD forecasts global economy improving, eurozone lagging behind

PARIS - Global economic activity is picking up, but the continuing crisis in the eurozone is delaying the recovery with labor market remaining weak, the Organization for Economic Co-operation and Development (OECD) said Thursday.

"The global economy weakened in late 2012 but the outlook is now improving for OECD economies," said Pier Carlo Padoan, OECD Chief Economist, while presenting the latest Interim Economic Assessment on G7 in the Paris-based headquarters.

The OECD new report shows that the world's seven leading economies, including the United States, Britain, France, Germany, Italy, Canada and Japan, are expected to grow at an annualised 2.4 percent rate in the first quarter of 2013 and at a 1.8 percent rate from April to June.

The U.S. economy is expected to see a rebound of 3.5 percent in the first quarter of 2013 before returning to moderate growth of 2.0 percent in the second, much better than the 0.1 percent registered in the fourth quarter of 2012. Canada is set to grow by 1.1 percent and 1.9 percent respectively.

Japan will follow up from previous low levels to grow 3.2 percent during the first quarter and 2.2 percent in the second, while the rates are projected to see an increase of 0.5 percent and 1.4 percent respectively in Britain.

However, the outlook for the eurozone points to a renewed divergence,  with the top three economies in the bloc forecasting an growth by 0.4 percent during the first quarter and by an additional 1 percent in the second.

Germany is leading to expectations of growth in the eurozone, its economy is expected to rise by 2.3 percent in the first quarter and by 2.6 percent in the second.

As for France, which economy posted minus 1.2 percent in the fourth quarter of 2012, will see a 0.6 percent contraction in the first quarter followed by a 0.5 percent rebound in the second.

Italy will come last among the top three, with its real GDP expected to drop by 1.6 percent in the first quarter and by an additional 1 percent in the second.