Despite a downgrade by the club of rich nations to its projection next year from 5.2pc to 4.7pc, the UK will still lead the G7 pack.

However, the OECD called on the Bank of England to act against “clear signs of persistent price pressures” by raising interest rates, warning the UK will suffer a setback if supply chain disruption worsens.

The OECD said: “Labour shortages are emerging in sectors particularly affected by the pandemic and in which EU-born migrants were also over-represented, such as accommodation and food services.” 

It added that the omicron variant “could be a threat to the [global] recovery” and risked worsening supply chain chaos and causing inflation to spiral. The OECD expects UK inflation to peak at 4.9pc by mid-2022, down from 5.2pc previously.

The OECD said the UK’s vaccine booster rollout meant it was more resilient in the face of new uncertainties. Britain has been slower than the US or China to return to its pre-Covid GDP but should get to that point soon, according to the organisation.

China’s growth forecasts were downgraded significantly by the OECD on Wednesday, which predicted growth of 8.1pc this year, down from the previous 8.5pc forecast, as its zero-tolerance stance on Covid outbreaks risks becoming counter-productive. The country’s economy is now expected to grow 5.1pc in 2022, down from 5.8pc, the OECD said.

It added: “With the preponderance of virus variants that are more contagious and more difficult to trace, and the disruption of supply chains due to restrictions, the zero tolerance policy is increasingly questioned. 

“Given the rapid spread of new variants and the high share of asymptomatic carriers (partly owing to vaccination), border controls are unlikely to be an effective way to remain Covid-free in the longer run.”