The spread of the highly contagious delta variant has stymied development.
The Paris-based organization estimates that US GDP – the most comprehensive measure of goods and services produced by a nation – will grow 6% in 2021. That’s down about 1 percent from May, when the OECD predicted GDP would grow 6.9% this year. Year.
By comparison, GDP contracted at a 3.5% annual rate in 2020, when the economy nearly came to a standstill in a bid to slow the spread of COVID-19. The virus has infected more than 42 million Americans and killed more than 674,000.
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Although the economy gained steam in the spring amid widespread vaccination and an easing of trade restrictions, the spread of the highly infectious Delta variant in the summer has stymied growth, the OECD said.
“The prevalence of the more transmissible delta variant is still causing high numbers of infections, and there are significant differences in the pace of vaccination and the scope for policy support across countries,” the organization said. “The delta variant has so far had a relatively mild economic impact in countries with high vaccination rates, but there are indications that it may undermine confidence and lower near-term growth momentum.”
There are other signs of slowing: Retail sales softened in July, and global car sales also declined. On top of that, pandemic-induced supply shortages in key sectors such as semiconductors and shipping have largely resulted in slowdown in industrial production and global business trade growth. The increased timing of supplier deliveries has also led to production halts in some industries, particularly auto manufacturing.
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“A key near-term uncertainty is that the delta version increases the risk of continued shutdowns in some Asian economies, with an adverse impact on the availability of supplies and the pace of global recovery,” the group said.
While the US was making solid progress with vaccination – 76.5% of adults At least one shot has been received, according to the Centers for Disease Control and Prevention — and infections began to subside, with cases resuming in the summer as the highly infectious Delta variant spread to a largely unvaccinated population.
The US is reporting an average of about 1,000 new COVID-19 cases daily, with nearly 1,000 deaths, according to CDC data.
Although successful infections occur in people who are vaccinated, they are much less dangerous.