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Total OECD real investment, and in particular housing investment, dropped precipitously at the peak of the crisis and its recovery has been sluggish. Weak investment has depressed productivity growth and will, if it persists, entrench low equilibrium growth and poor job prospects in the short and longer term.

Economic growth was strong in 2014 and is projected to continue at a solid pace in 2015 and 2016, boosted by domestic demand. The unemployment rate is projected to fall further towards 5%. As spare capacity wanes, inflation is expected to pick up towards the 2% inflation target. The current account deficit has widened to above 5% of GDP, notably as investment income has disappointed, but is projected to narrow gradually as the euro area continues to recover.

After a sharp slowdown in 2014 the economy is projected to gradually recover in 2015 and 2016. The pick-up in activity will initially be driven by higher public spending, but will increasingly be supported by stronger external demand for industrial goods from the United States and Europe.

Output growth paused in early 2015, weighed down by the stronger dollar and adverse weather. Nonetheless, the labour market has continued to improve, as evidenced by job gains in the private sector and a falling unemployment rate. Supportive monetary conditions and lower energy prices should underpin a sustained pick-up in aggregate demand as the fiscal policy drag dissipates and ongoing increases in household wealth lift consumer spending and residential construction.

Growth is projected to continue to edge down, to 6.7% by 2016. Slowing real estate and business investment will be countered to some extent by stepped-up infrastructure investment. Consumption is set to remain robust. Urbanisation and the rapid expansion of service industries will generate employment and keep unemployment low. Enduring overcapacity in some heavy industries should keep producer price inflation negative and consumer price inflation low.

Growth weakened in early 2015, after a short-lived upturn in late 2014. The uncertainties associated with the forthcoming legislative elections and ongoing geopolitical tensions in the region are holding back investment and consumption spending. GDP growth is projected to pick up gradually over 2015 and 2016, after the wait and see attitudes of businesses and households dissipate, but to remain below potential.

This annex contains data on key economic series which provide a background to the recent economic developments in the OECD area described in the main body of this report. Data for 2015 to 2016 are OECD estimates and projections. The data in some of the tables have been adjusted to conform to internationally agreed concepts and definitions in order to make them more comparable across countries, as well as consistent with historical data shown in other OECD publications. Regional aggregates are based on weights that change each period, with the weights depending on the series considered. For details on aggregation, see OECD Economic Outlook Sources and Methods.

Growth is projected to slow to around 1½ per cent in 2015 before rebounding in 2016. The recent fall in oil prices has resulted in declines in related investment and GDP. However, substitution towards non-energy exports is underway, supported by the currency depreciation and stronger foreign-market growth. Non-oil related business investment should strengthen with a lag. Following recent weather-related weakness, consumption growth should pick up. With economic slack fully absorbed, inflation is projected to return to the 2% midpoint of the inflation target range by mid-2016.

Private consumption and investment continue to grow briskly, while foreign trade will make a significant but modest contribution to growth. Unemployment is projected to recede only slowly, as integrating the substantial flow of immigrants takes time and labour force participation increases. Inflation is set to pick up gradually, as wages increase and the disinflationary effect of falling oil prices fades out.

The recovery is projected to gradually strengthen. Economic growth is expected to broaden with rising exports and business investment owing to supportive financial conditions and improving external demand. Household consumption growth will be held back by fiscal consolidation and wage restraint. Inflation will pick up somewhat in 2016 as the effects of falling oil prices wears off.

The economy is projected to contract this year, but a slow recovery is expected to unfold gradually from the end of 2015, driven initially by strengthening exports, which will be boosted by the depreciation of the real.

The economy has weakened thus far in 2015, but growth is projected to rise gradually into 2016 as the recent large exchange rate appreciation is absorbed. Private consumption should hold firm on the back of rising real wages and very favourable financial conditions, but exports and business investment will suffer. Lower oil prices combined with the higher Swiss franc are bringing inflation back into negative territory.

After a long recession, the Italian economy has started its gradual recovery. Output is projected to grow by 0.6% in 2015 and by 1.5% in 2016. Exports will continue to support growth, but the recovery will broaden to private consumption. Sluggish private investment will be countered by rising public infrastructure spending. Economic growth will result in employment gains and lead to a decrease in the unemployment rate, which will still remain high. Consumer price and wage inflation will remain moderate due to persistently large economic slack.

Output growth, supported by strengthening private consumption, is projected to continue to rise, reaching 3.7% in 2016. The labour market will make further progress, and exports will benefit from firmer international trade and faster growth in the euro area. Energy and food prices have started to turn around following sharp falls, and, after several months of deflation, consumer prices should gradually pick up again.

Economic growth is projected to gain momentum in 2015 and 2016. Lower energy prices, improving financial conditions, slowing fiscal consolidation, strengthening external demand and a pro-competitive reform agenda should underpin an increase in consumption and export volumes. Stabilising energy prices and euro depreciation will raise the price level, although persistent and significant economic slack will continue to put downward pressure on inflation. However, weak business confidence is still weighing on investment, implying a delayed pick-up in hiring and only a marginal decline in unemployment.

Economic growth will remain high, supported by a revival in investment. The FY 2015-16 fiscal consolidation target has been relaxed to allow for increased infrastructure investment while structural reforms to improve the ease of doing business and the Make in India initiative should boost corporate investment. Export growth will be held back by the currency appreciation. The decline in oil prices will reduce pressures on the current account deficit, inflation and subsidies.

Growth is projected to dip to 2¼ per cent in 2015 but pick up to nearly 3% in 2016. Gathering momentum in consumption, non-resource investment and exports help the economy adjust and recover from the fall in commodity prices and unwinding resource-sector investment. Consumer price inflation has been dented by lower oil prices and will remain moderate due to economic slack.

Output growth is projected to slow to around 3% in 2015, reflecting sluggish private consumption in the context of high household debt and stagnant wages. Inflation has fallen to less than 1%, well below the target range of 2.5% to 3.5%, while weak domestic demand is boosting the current account surplus to around 7% of GDP. Lower oil prices are projected to support stronger consumption and investment, boosting output growth to 3½ per cent in 2016.

Economic growth in 2015 remains weak, as uncertainty related to the reform programme and deteriorating liquidity conditions have undermined business confidence and investment. In 2016, growth will gain momentum and unemployment will decline somewhat as exports and investment recover while reform momentum is renewed. Deflation will continue in 2015 due to the very large degree of slack in the economy.