IMF sees global growth holding at 3.3% in 2026

Global economic growth is projected to remain resilient at 3.3% in 2026 and ease slightly to 3.2% in 2027, broadly in line with the estimated 3.3% outturn in 2025, the International Monetary Fund said in its latest World Economic Outlook update released on 19 January.

The IMF said the 2026 projection reflects a small upward revision from its October 2025 forecast, while the outlook for 2027 remains unchanged.

“This steady performance on the surface results from the balancing of divergent forces,” the IMF said, noting that headwinds from shifting trade policies are being offset by strong investment linked to technology, including artificial intelligence, particularly in North America and Asia.

The Fund said global activity continues to benefit from accommodative financial conditions, fiscal and monetary support in several economies, and the adaptability of the private sector.

Global headline inflation is expected to decline from an estimated 4.1% in 2025 to 3.8% in 2026 and further to 3.4% in 2027. The IMF said inflation is projected to return to target more gradually in the United States than in other major economies, with inflation forecasts broadly unchanged from October.

Despite the stable growth outlook, the IMF warned that risks remain skewed to the downside. It said a reassessment of productivity gains from artificial intelligence could weaken investment and trigger a sharp financial market correction, potentially spreading beyond AI-related firms and eroding household wealth.

Source - The Morning