In its quarterly health check, the Paris-based thinktank said better-than-expected performance by the United States and the bigger developing countries had allowed it to revise up its forecasts for the first time in two years.
But the OECD had less good news for the UK, revising down its growth estimate this year to -4.3%, the biggest one-year fall in output since 1945 and lower than Alistair Darling's budget forecast of a 3.5% decline. Previously, the OECD had pencilled in a 3.7% contraction for Britain this year.
The OECD's Economic Outlook said the UK was in a "severe recession" and could expect only a mild recovery during the course of 2010, when it believes output will be unchanged.
"The financial crisis has severely impaired the supply of credit and house prices have fallen sharply, thus restraining business and household spending."
While the fall in the value of the pound was helping to mitigate the downturn, unemployment is predicted to rise towards 10% in 2010, the likely date for the next general election.
Britain's budget deficit, the OECD warned, would hit 14% of GDP next year - the biggest of any of the OECD's 30 member countries. "To improve stability, the government should continue to develop a concrete and comprehensive plan to ensure that debt is on a declining path once recovery takes hold", the outlook said.
It added that the crisis had highlighted significant weaknesses in financial regulation, with further measures needed to strengthen supervision.
The thinktank said it now expected growth among its rich-country members to shrink by 4.1% this year and post modest growth of 0.7% in 2010. In its last forecast in March, it had pencilled in a 4.3% decline this year followed by a further 0.1% drop in 2010.
Patchy signs of recovery
It warned, however, that signs of recovery were patchy, with the eurozone economy expected to shrink by 4.8% this year - worse than the March prediction of a 4% drop. Expectations of Japanese growth have remained little changed, at -6.6% for 2009.
Angel Gurría, the OECD's secretary general, said: "Thanks to firm action to stimulate our economies it appears that we have escaped the worst during this crisis.
"But the next few months will be equally testing. There needs to be a clear and credible plan and timeline for phasing out the emergency measures as the recovery takes hold. It is critical to consider these exit strategies now in order to prevent new risks in the years ahead."
Gurría said at a press conference that world trade was likely to shrink by 16% this year - the weakest performance since the 1930s. Unemployment would remain high even after economic recovery was fully under way.
"The large amount of spare capacity implies that inflation falls to low levels", he added. "But it is really only Japan that will experience an actual drop in prices for an extended period of time. We don't see a danger of deflation."
The outlook said economic activity in the US was expected to fall by 2.8% this year, better than the 4% decline predicted three months ago. Growth of 0.9% is forecast for 2010, up from zero in March.
Expansion in developing countries is helping to offset the weakness of the rich western economies, the OECD said, even though growth was lower than during the boom years earlier in this decade.
China, helped by a "major stimulus" package, should see growth of 7.7% this year, rising to 9.3% in 2010, both up from the March forecasts of 6.3% and 8.5% respectively. Indian growth is predicted to be 5.9% in 2010, accelerating to 7.2% in 2010.
The other two leading developing countries will do less well, the OECD said. Brazil will contract by 0.8% this year, rebounding to 4% expansion in 2010. Russia's economy will shrink by 6.8% this year but grow by 3.7% in 2010.
Copyright Speakers Corner 2017