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Euro zone growth seen weakening: OECD

Economic growth is set to slow in the euro area, the Organization of Economic Cooperation (OECD) warned on Wednesday, in the latest blow to hopes the region's fortunes were improving.

A homeless woman sits in front of a shuttered shop in Athens, Greece.
Ayhan Mehmet | Anadolu Agency | Getty Images
A homeless woman sits in front of a shuttered shop in Athens, Greece.

It comes after euro zone gross domestic product (GDP) came in flat—below expectations—in the second quarter of this year, having edged up by just 0.2 percent between January and March.

Now, OECD said its composite leading indicators, designed to anticipate turning points in economic activity, suggested a continued slowdown—or even contraction—in the coming months.

"Signs are emerging of a loss of growth momentum in the euro area, with stronger signals in the case of Germany and Italy, while in France and in the United Kingdom, the outlook continues to point to stable growth," the research body said on Wednesday.

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Just a day before, the International Monetary Fund (IMF) cut its global growth forecasts and identified the euro zone's stalling recovery as a key risk to the world economy. It warned of weakening demand in the region and even a slide into deflation, after inflation fell once again in September.

"This is not our baseline, as we believe fundamentals are slowly improving, but, were it to happen, it would clearly be the major issue confronting the world economy," the IMF said in a report.

Read More'Weak and uneven': IMF cuts global growth forecast

The OECD also said that economic growth was seen slowing in Japan. It identified India as the only major economy where indicators pointed to a pick-up in growth.

The organization also pointed to stable growth in Canada and the U.S., as well as in Brazil, China and Russia—despite the West's economic sanctions against the latter following its incursion in Ukraine earlier this year.

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