UK inflation is expected to be 3.5% this year - unchanged from the OECD's previous forecast, but the highest in the G7. The inflation rate is then predicted to drop to 2.5% next year, down from its previous estimate of 2.7%.
Unemployment is set to rise to 4.9% in 2026, the OECD says, and to 5% in 2027.
Reacting to the OECD's report, Chancellor Rachel Reeves said: "Last week, my Budget cut waiting lists, cut borrowing and debt, and cut the cost of living. Less than a week later, the OECD has upgraded our growth and cut its forecast for inflation next year.
"The choices that I made at the Budget are expected to cut inflation by 0.4 percentage points, helping cut the cost of living for households and costs for our businesses."
Shadow chancellor Mel Stride said: "Rachel Reeves promised growth but growth is expected to weaken next year, because of her choices. This is the cost of policies that punish work, businesses and investment."
Reeves has come under pressure since delivering her Budget following accusations that she gave a misleading picture of the government's finances ahead of the announcement.
The OECD said the government deficit should improve "substantially", but it added that care needed to be taken with changes to tax and spending "given substantial downside risks to growth and upside risks to inflation".
"Tax and spending measures should also aim to further support growth potential, complementing ongoing structural reforms such as the overhaul of infrastructure planning and the simplification of financial services regulation."