The global economy is “turning a corner”, according to the latest outlook from the Organisation for Economic Cooperation and Development as it upgraded the UK’s growth forecast for this year to faster than Japan, Italy and Germany.

The OECD ranked Britain joint second among the G7 developed countries behind the US in its latest outlook on the global economy, but the UK is still expected to have the highest inflation in the group.

Describing the UK’s economic growth as “robust”, the OECD upgraded its growth for 2024 to 1.1% from a forecast of 0.4% made in May, as the country recovers from a mild recession at the end of last year. The forecast of 1.2% growth in 2025 was maintained.

In the May forecast, the UK was behind all other nations in the informal bloc but is now expected to outpace Japan, Italy and struggling Germany. Britain is now on a par with Canada and France but behind the US.

However, Britons are still expected to face headwinds from rising prices, with inflation expected to increase from 2.2% in August to 2.7% by the end of the year. UK inflation is on course to remain at 2.4% for 2025, rising at the fastest rate in the G7.

Overall, the OECD said that the global economy was “turning a corner” and lower inflation and cuts to the cost of borrowing by central banks would support “ongoing momentum” in most major economies. Those conditions will allow the global economy to return to health after the shocks caused by the coronavirus pandemic and Russia’s invasion of Ukraine, it said.

The OECD’s chief economist, Álvaro Pereira, said he was surprised by the strength of the recovery earlier in the year after the UK economy contracted in 2023.

The OECD was among the most pessimistic economic forecasters when it made a judgment in May that low consumer spending and weak business investment would drag on Britain’s growth.

Business investment has remained low, but rising wages and low inflation boosted consumer spending by more than expected.

Sweden’s Riksbank has cut interest rates and signalled further reductions in the coming months and early next year, as inflation has fallen below the central bank’s target.

It cut its policy rate by 0.25 percentage points to 3.25%, saying:

Inflationary pressures have fallen over the year and are now assessed to be compatible with an inflation rate of around 2%.

The Riksbank has gradually eased its monetary policy over the year, by both cutting the policy rate and communicating that further cuts can be expected. Low and stable inflation and falling interest rates are contributing to a recovery in the economy.

Headline inflation has continued to fall from a peak of of over 10% in 2022, coming in at 1.2% in September – below the Riksbank’s forecast and its 2% target. It started cutting rates in May, the first easing in eight years, followed by another move in August.

Lower inflation is leading the world’s oldest central bank, founded in 1668, to reduce borrowing costs at a faster pace than previously flagged, as it explained in today’s statement:

If the outlook for inflation and economic activity remains unchanged, the policy rate may also be cut at the two remaining monetary policy meetings this year. A cut of 0.5 percentage points is possible at one of these meetings.

Moreover, the forecast indicates one or two further rate cuts during the first half of 2025. The policy rate is thus expected to be cut at a clearly faster pace than was previously communicated, which contributes to stronger economic activity and an inflation rate close to the target.

While Chinese stocks had another day of strong gains on the back of Beijing’s stimulus blitz, shares in London and the rest of Europe have fallen this morning.

The UK’s FTSE 100 index is down 0.17%, or 13 points, at 8,269. Rentokil Initial is the biggest riser, up 3%, following the news that the activist investor Nelson Peltz’s Trian Partners has taken a seat on the struggling pest control company’s board.

The Dax in Frankfurt fell by nearly 0.5% while the CAC in Paris slipped by 0.4% and the FTSE MIB in Milan was little changed.

The union representing 33,000 striking Boeing workers says a survey of its members shows they are “not interested” in the aircraft maker’s latest 30% pay offer.

The International Association of Machinists and Aerospace Workers (IAM), Boeing’s largest union, said in a post on X, formerly known as Twitter:

Our members stand strong, and we remain ready to continue mediated or direct negotiations with Boeing. This has been made clear to both the company and our membership. The only way to resolve this strike is through negotiations, and rest assured, your Union will not bargain through the media.

The survey results from yesterday were overwhelmingly clear, almost as loud as the first offer: members are not interested in the company’s latest offer that was sent through the media. Many comments expressed that the offer was inadequate and the company’s decision to bypass the Union was viewed as disrespectful.

Yesterday, the union reacted with anger at what Boeing called its “best and final” pay offer of a 30% rise per four years. It included the reinstatement of a performance bonus, improved retirement benefits and a one-off $6,000 (£4,470) bonus.

The company said the offer was dependent on it being ratified by union members by midnight Pacific time on Friday 27 September.

However, IAM declined to put the offer to a vote, saying the proposal was not negotiated with the union and that it fell short of members’ demands.

Boeing has said its latest offer, made after unsuccessful federal mediation last week, made significant improvements and addressed demands from the union and employees. “We first presented the offer to the union and then transparently shared the details with employees,” the company added.

Nelson Peltz’s Trian Partners has taken a seat on Rentokil Initial’s board, a fortnight after the pest control company issued a profit warning, sending its shares sharply lower.

Today, the shares rose by 2.9%.

Trian, a New York-based hedge fund founded by Nelson Peltz and Peter May, is an activist investor with a 2.3% stake in Rentokil.

Its head of research, Brian Baldwin, will sit on Rentokil’s board as a non-executive director from 1 October, and will also join its nominations and remuneration committees. He has played leadership roles in many of Trian’s investments, and also sits on the board of the UK fund manager Janus Henderson.

Richard Solomons, Rentokil’s chairman, said:

We look forward to working with him to deliver long-term sustainable value for our shareholders and, in particular, executing our plans to integrate the Terminix business and to increase organic growth in our North America operations.

Rentokil became the biggest pest control company in the world with the $6.7bn deal to acquire US rival Terminix agreed in December 2021.

Weaker demand for termite extermination services sent Rentokil shares crashing by 19% on 11 September, after the company warned of lower profits caused by a slowdown in North America.

The Co-op Group, which owns Britain’s seventh-biggest supermarket chain, is back in the black, as growth in membership and its quick commerce business offset rising costs.

The Co-op, which is owned by its members, said the number of members had grown by 20% to 5.5 million, putting it on target to reach 8 million by 2030.

The group has a partnership with Uber Direct, allowing shoppers to order groceries on the Co-op website with delivery through the Uber Eats’ network.

It plans to open 120 new food stores by the end of next year. The 180-year-old group runs almost 2,400 supermarkets as well as funeral, insurance and legal services businesses. Food sales grew by 3.2% while legal services posted 35% revenue growth, the fastest-growing division.

The Co-op made a profit before tax of £58m in the first half of the year, compared with a loss of £33m a year earlier. The group credited lower interest payments and strong Funeralcare investment returns. Revenues rose by £100m to £5.6bn.

Shirine Khoury-Haq, the chief executive, said:

We have delivered a strong performance for the first six months of this year as our strategy starts to gain real momentum. Although the external environment remains challenging, it is testament to the underlying strength of our Co-op that we have outperformed in all our markets while significantly increasing our investments in our colleagues, pricing and in the growth of our businesses.

Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.

The British online property portal Rightmove has rejected an improved £6.1bn takeover proposal from billionaire Rupert Murdoch’s REA Group, saying it undervalued the company.

The Australian group said on Monday that it had made a third offer for the company, worth £6.1bn. But Rightmove said the increased proposal “continues to be unattractive and materially undervalues the company and its future prospects”.

REA responded swiftly, saying it was “disappointed” by the latest rejection, and “frustrated” that the rejections aside, “REA has still had no substantive engagement with Rightmove”. It added:

REA urges Rightmove shareholders to encourage the board of directors of Rightmove to engage in constructive discussions with REA to work towards a recommended transaction,

ahead of next Monday’s “put up or shut up” deadline.

Chinese stocks have rallied for a second day, fuelled by Beijing’s stimulus, while the rest of Asia is more mixed.

The mainland China CSI 300 index rose by 1.68% following a 4.3% jump the day before, while Hong Kong’s Hang Sing added nearly 1% after Tuesday’s 4.1% leap. Japan’s Nikkei slipped by 0.26% while South Korea’s Kospi lost 1%.

The People’s Bank of China launched a blitz of stimulus measures to support its economy, cutting the amount of cash banks must hold on their books, lowering several key interest rates and unveiling more support for the property market.

The news lifted stocks around the world. On Wall Street, the S&P 500 celebrated its 41st record high yesterday.

However, Ipek Ozkardeskaya, senior analyst at Swissquote Bank, cautioned:

The problem is, the stimulus measures will take time to show in the economic data. And more worryingly, they won’t do much to fix the country’s deepest issues – they won’t reverse local governments’ heavy debt burden, China’s aging population, and will hardly boost the demand-led growth. As such long-term investors appreciate the efforts but prefer to watch from a distance for now.

The Agenda

• 8.30am BST: Sweden Riskbank interest rate decision

• 12pm BST: US MBA Mortgage applications

• 3pm BST: US New Home sales for August