The odds are improving that financial market turmoil has passed its peak. Still, its fallout will continue to act as a brake on growth for considerable time to come. Other headwinds causing the on-going slowdown in activity in the OECD area are likely to continue, including cooling housing markets and high commodity prices. Weakness has been most marked in the United States. However, despite buoyancy during the first quarter of 2008 in Japan and Germany, the slowdown is set to generalise across virtually all OECD economies (Table 1.1). There is also some slowdown outside the OECD area, albeit partly induced by policies aimed at restraining inflation.