The International Monetary Fund (IMF) raised its global growth forecast for 2026, citing business adaptations to US tariffs and continued investment in artificial intelligence (AI) as key drivers. In its latest World Economic Outlook update, the IMF projected world GDP growth at 3.3% for 2026, up 0.2 percentage point from its previous estimate in October 2025. Global growth in 2025 also came in slightly higher than expected, at 3.3%, surpassing earlier predictions.
IMF chief economist Pierre-Olivier Gourinchas said the global economy has proven resilient in the face of trade disruptions in 2025. “The global economy is shaking off the trade and tariff disruptions of 2025 and is coming out ahead of what we were expecting before it all started,” he said. Companies have adapted to higher US tariffs by rerouting supply chains, while trade agreements and export diversification, particularly from China to non-US markets, have supported economic activity.
The Fund highlighted AI investment as a major factor driving growth, particularly in the United States, where 2026 growth is forecast at 2.4%, up 0.3 percentage point from October. Investment in AI infrastructure, including data centres and specialized chips, has boosted both productivity expectations and asset values. However, the IMF warned that overly optimistic expectations for AI could trigger market corrections if gains fail to materialize.
Europe also benefited from technology and fiscal support. Spain’s 2026 growth forecast was raised to 2.3%, while the euro zone overall is projected to expand 1.3%, supported by higher public spending in Germany and improved performance in Spain and Ireland. The IMF kept the UK forecast at 1.3% for 2026. Japan’s growth forecast was slightly upgraded following fiscal stimulus measures. Brazil, in contrast, saw its 2026 forecast reduced to 1.6%, reflecting tighter monetary policies to curb inflation.
China’s economy is expected to grow 4.5% in 2026, down from 5% in 2025 but above earlier estimates, aided by a temporary reduction in US tariffs and export redirection to Southeast Asia and Europe. Gourinchas cautioned that China will need to shift toward a growth model less reliant on exports and more focused on domestic demand to avoid future trade-related setbacks.
The IMF also noted that risks to global growth remain, including potential flare-ups in trade tensions, supply chain disruptions, and volatility in AI-driven markets. A pending US Supreme Court decision on Trump-era tariffs could add further uncertainty.
Global inflation is forecast to continue declining, from 4.1% in 2025 to 3.8% in 2026 and 3.4% in 2027. Gourinchas said this provides central banks with room for accommodative policies to support growth.
Overall, the IMF sees a cautiously optimistic outlook, with AI and trade adjustments providing momentum, while geopolitical and market risks continue to temper expectations.
