The Organisation for Economic Co-operation and Development (OECD) yesterday said United States and European interest rates needed to fall further to cushion the impact of a forthcoming global economic slowdown. In the preliminary edition of its biannual Economic Outlook , the OECD said it expected interest rates to fall at least 50 basis points next year on top of the 50 basis point cut that had already taken place. The OECD said developed economies' markets had been hit by the continued buffeting from financial crises ravaging Asia, Latin America and Russia, creating crippling trading losses in the banking sector. The body predicted the global economy would grow just 2.1 per cent next year, from 2 per cent this year, before jumping 2.9 per cent in 2000. Economies in the 29-strong OECD community would slow to a 2.25 per cent growth rate this year and slip further to 1.75 per cent next year, before recovering to 2.25 per cent in 2000. Economic growth predictions for the US were based on expectations that the Federal Reserve Funds rate - which before the Federal Open Market Committee meeting early this morning was 5 per cent - would be lowered to 4.5 per cent. It forecast US gross domestic product growth would slow to 1.5 per cent next year, from 3.5 per cent this year.