The Organization for Economic Cooperation and Development (OECD) has revised upward its inflation forecast for the Group of 20 (G20) economies, projecting an average rate of 3.6 percent in 2027. This marks an increase of 0.5 percentage points from the forecast released in June, reflecting ongoing pressures from higher energy costs.

According to the OECD’s latest economic outlook published Wednesday, inflation across the G20 is expected to decline from 4.1 percent in 2026 but remain elevated compared to previous estimates. The report emphasizes the continuing challenges faced by policymakers worldwide in managing rising cost-of-living concerns amid fluctuating commodity prices.

Japan’s inflation is projected to remain steady at 1.8 percent for 2026 but is anticipated to accelerate to 2.6 percent the following year. This rise is attributed to factors including increased energy prices and a weaker yen, which has inflated import costs. The Bank of Japan is confronting difficulties in controlling these inflationary pressures as it seeks to balance monetary policy with economic growth.

The OECD report notes, “Inflation is projected to increase in the near term, reflecting commodity price increases, before easing gradually in 2027 as moderating energy prices and tighter monetary policies help to limit broader price pressures.”

The organization also raised its 2027 inflation forecasts for major economies such as the United States and the euro area. The U.S. inflation estimate was adjusted upward by 0.5 percentage points to 2.6 percent, while the euro area’s forecast increased to 2.9 percent from previous projections. These adjustments highlight the persistent inflationary environment affecting advanced economies and underscore the complexities in crafting effective responses amidst ongoing global economic uncertainties.