Global economic growth is at a high rate this year, mainly due to Donald Trump’s U.S. tariffs, according to leading international policy groups.

The Organization for Economic Cooperation and Development (OECD) said global growth is now expected to drop to a “moderate” 2.9%, down 2.9% from the previous 3.1% forecast.

It accused the “significant” rise in trade barriers and warned that “economic outlooks around the world will weaken, and it is almost no exception”.

This will include the UK as it trims the country's growth forecast, the OECD said. But it added that the UK faces its own challenge and should consider tax revenues as a means of “strengthening public finance.”

Tariffs have targeted a range of countries since the U.S. president returned to the White House, but the unpredictable approach to Trump's implementation of these measures has created widespread uncertainty.

"We are basically predicting a downgrade for almost everyone," OECD chief economist Alvaro Pereira told the BBC.

“We are growing and creating jobs much less than we have predicted in the past.”

The group also cuts outlook for the U.S. economy from 2.2% to 1.6% this year, with growth forecasting another slowdown in 2026.

It warns that inflation in the United States has risen and Trump has repeatedly promised to be in trouble during his presidential campaign.

"Our economy is booming due to tariffs," Trump wrote on social media ahead of the OECD report on Tuesday!

However, the latest official data shows that the U.S. economy’s annual salary was 0.2% in the first three months of this year, the first contraction since 2022.

Meanwhile, the OECD has reduced its expectations for UK growth this year to 1.4% of the March forecast.

It also predicts that the UK economy will grow by 1% in 2026, compared with 1.2% a few months ago.

The OECD said the UK's growth will be "suppressed by increased trade tensions" and "elevated uncertainty".

But the group said there are other issues in the UK, especially government debt payments and a “very thin” financial buffer.

In March, Prime Minister Rachel Reeves was forced to announce £14 billion measures, including £4.8 billion in welfare cuts, to restore the headroom of her self-imposed fiscal rules.

The OECD highlighted better economic growth than the UK, growing to 0.7% between January and March, but warned that “momentum is weakening” due to “deteriorating” business sentiment.

It recommended that Reeves should increase tax revenue, including ending loopholes and reevaluating the Council tax belt based on the latest property value.

Under the current system, the Council Tax in England is calculated based on the price of the property sold in April 1991. For Wales, it was assessed for the April 2003 property prices.

Next week, Reeves will list her spending reviews, where she faces tough choices when allocating department budgets.

"Strengthening public finance remains a priority by developing ambitious government fiscal plans, including through an upcoming spending review," the OECD said.

The government has pledged billions of pounds of national defense, and the NHS is expected to be the focus of Labor's commitment to reduce its waitlist.