The IMF has lowered its forecast for global economic growth in 2026 to 3%

The International Monetary Fund (IMF) has once again lowered its forecast for global economic growth in 2026 to 3%. This is stated in the July update to the World Economic Outlook.

In 2027, growth is expected to recover to 3.4%, though this is below the average of 3.5% recorded in 2024–2025.

As the review notes, the global outlook is shaped by the lingering effects of the energy shock caused by the war in the Middle East and a technology-driven investment boom. The impact of these factors varies significantly depending on the country, its exposure to the conflict and its position in the technology value chain.

The IMF expects global inflation to rise from 4.1% in 2025 to 4.7% in 2026, which is 0.3 percentage points higher than forecast in the April review. Inflation is then expected to slow to 3.9% in 2027.

According to the institution’s estimates, the growth rate of world trade will slow sharply to 3.5% in 2026, compared with 5% in 2025.

At the same time, the IMF notes that the global economy has so far weathered the shock of the war in the Middle East better than expected. A sharper spike in oil prices was avoided thanks to a reduction in stocks, an expansion of production outside the Persian Gulf, and measures aimed at dampening demand. Furthermore, the steady growth in the share of renewable energy sources, combined with lower energy intensity, has also made the economies of many countries more resilient. And although financial conditions deteriorated sharply in April, they have since eased and remain favourable by historical standards.

As regards individual economies, the IMF has left its growth forecast for the US for the current year unchanged at 2.3%. Growth expectations for the euro area have been revised down to 0.9% (from 1.1% in the April review). The forecast for China has been revised up to 4.6%.

It should be noted that in June, the European Central Bank raised its inflation forecast for 2026 to 3%, compared with 2.6% in its previous, March review. The forecast for 2027 stands at 2.3%, and for 2028 at 2%. The ECB has also lowered its forecast for eurozone economic growth this year by 0.1 percentage points, to 0.8%.