The Organisation for Economic Co-operation and Development (OECD) has downgraded the prospects for global growth this year and next, including a sharp hit to activity in the U.S., Canada and Mexico, reports The Guardian.

The Paris-based body representing the world’s richest economies said March 17 that recent progress in bringing down inflation and higher levels of economic growth were being undermined by the fallout from the trade wars initiated by President Donald Trump, bringing higher trade barriers and mounting geopolitical uncertainty.

The OECD cut U.S. growth forecasts from 2.5% to 2.2% for this year and from 2.1% to 1.6% in 2026. Growth in China is projected to slow from 4.8% this year to 4.4% in 2026. It also lowered its forecast for U.K. growth by 0.3 percentage points for 2025 to 1.4%, and by 0.1 percentage points for 2026 to 1.2%. Global growth is forecast to slow this year from 3.3% to 3.1%. The global economy grew by 3.2% in 2024.

“Higher and broader increases in trade barriers would hit growth around the world and add to inflation,” the OECD said in its interim economic outlook report. “Governments need to find ways of addressing their concerns together within the global trading system to avoid a significant ratcheting-up of retaliatory trade barriers between countries… A broad-based further increase in trade restrictions would have significant negative impacts on living standards.”