2026.04.1413:43:10UTC+00IMF Cuts 2026 Global Growth Outlook

The IMF has lowered its global growth forecast for 2026 to 3.1%, a reduction of 0.2 percentage points from its previous projection, while keeping its 2027 forecast unchanged at 3.2%. The revision reflects the economic impact of the ongoing conflict in the Middle East. Although the baseline scenario assumes the conflict remains contained, the IMF cautions that a prolonged escalation could further weaken global growth and unsettle financial markets.

The Fund also highlighted that the energy supply shock stemming from the Iran-related tensions is comparable in magnitude to the 1974 oil crisis, though it emphasized that the global economy is now more resilient and better able to absorb such disruptions.

Regionally, the U.S. economy is projected to grow by 2.3% in 2026 and 2.1% in 2027. China’s growth is expected to slow to 4.4% in 2026 and 4.0% in 2027. The euro area is forecast to expand by just 1.1% in 2026 and 1.2% in 2027. The UK and Japan are also set for subdued growth, with the UK expected to grow by 0.8% in 2026 and 1.3% in 2027, and Japan by 0.7% in 2026 and 0.6% in 2027.

Global inflation is projected to edge up slightly in 2026 before easing again in 2027.