IMF cuts 2026 global growth forecast to 3.0%

The International Monetary Fund cut its 2026 global growth forecast to 3.0% on Wednesday, down from 3.1% in April, and said renewed fighting in the Middle East added risks to the outlook.

Petya Koeva Brooks, deputy director of the IMF's research department, said recent developments showed the uncertainty around the forecast and that the fund would monitor events closely.

The IMF also projected global inflation at 4.7% this year, higher than it had previously expected. It forecast global growth would rise to 3.4% in 2027.

The fund said the overall downgrade was modest because demand linked to artificial intelligence was partly offsetting the effects of the war. IMF official Deniz Igan described the expected rebound as a “V-shaped recovery.”

The IMF said the impact differed widely across countries. It forecast US growth of 2.3% this year, euro area growth of 0.9%, and China growth of 4.6%. It downgraded growth in the Middle East and Central Asia by 1.2 percentage points to 0.7%.