In a half-yearly report, the Organization for Economic Cooperation and Development cut its forecast for world growth this year to 2.7 per cent and 3.6 per cent for next. In May, it had predicted 3.1 per cent and 4 per cent growth, respectively. There were particularly sharp downgrades for Brazil and India though China's forecast was raised.
The more pessimistic forecasts reinforced current thinking that gains in stock markets, fueled by easy monetary policy, are out of step with the reality of lackluster economic growth in rich developed nations and fading momentum in many developing economies.
Major stock benchmarks in Britain, France and Germany were lower, but by less than 0.1 per cent. Futures indicated modest gains on Wall Street, with S&P 500 and Dow futures both up 0.1 per cent.