Gross domestic product in the OECD countries (Organisation for Economic Co-operation and Development) rose by 0.4% in the fourth quarter of 2023 when compared to the previous quarter, according to provisional estimates.

Quarterly OECD GDP growth rates have remained weak over the past two years.

Across G7 countries, quarter-on-quarter GDP growth slowed slightly to 0.4% in Q4 2023 compared with 0.5% in Q3. This reflects a mixed picture among G7 countries.

On the one hand, GDP contracted in the UK (-0.3%) and Japan (-0.1%) for the second quarter in a row. GDP also contracted in Germany (-0.3%) following two quarters of zero growth. Growth slowed in the US (to 0.8% in Q4, compared with 1.2% in Q3), and France recorded zero growth for the second quarter in a row. On the other hand, the Canadian economy saw a recovery, with growth of 0.3% in Q4 following a contraction in Q3. Growth in Italy picked up slightly to 0.2%.

In the G7 countries reporting decreases in Q4 2023, the contributing factors varied. In the UK, falling exports of services (-6.0%) were the main drag on growth. In Japan, GDP contracted due primarily to decreases in investment (-0.3%), private consumption (-0.2%) and government consumption (-0.1%), which were partially offset by an 11.3% increase in services exports (mainly due to growth of tourism). In Germany, Q4 saw a marked decline in investment in construction and machinery and equipment.

In the European Union, quarterly GDP growth stood at 0.1% while in the euro area growth remained flat.

Among other OECD countries for which data is available, Costa Rica and Norway recorded the strongest GDP growth in Q4 (1.8% and 1.5% respectively), followed by Slovenia (1.1%). By contrast, GDP contracted most in Ireland (-0.7%).

Meanwhile, initial annual estimates indicate that OECD GDP growth slowed to 1.6% in 2023 compared with 2.9% in 2022, in a context of higher core inflation in OECD area.

Among the 27 OECD countries for which data is available, 10 recorded a GDP contraction in 2023, with Estonia contracting the steepest decline (-3.0%). In 14 countries, growth slowed but remained positive. Only three OECD countries recorded higher growth in 2023 than in 2022: Costa Rica (5.1% in 2023, compared with 4.6% in 2022), the US (2.5%, compared with 1.9%) and Japan (1.9%, compared with 1.0%).