The International Monetary Fund (IMF) revised its global growth forecast for 2026 and 2027 in its April report "Global Economic Outlook for 2026", forecasting global growth of 3.1 percent in 2026 compared with previous expectations, followed by a moderate recovery to 3.2 percent in 2027. The revision reflects the growing uncertainty caused by the conflict in the Middle East, as well as ongoing trade tensions and financial market volatility.
Overall global inflation is expected to increase slightly in 2026, mainly due to rising energy prices, and then decline again in 2027. The combined effect of slower growth and higher inflation is expected to have a stronger impact on emerging and developing economies, where external vulnerability remains high.
The risks are tilted towards lower growth rates and higher inflation
The IMF noted that the balance of risks has changed, and the risks of slowing economic growth and rising inflation have become more pronounced. Unfavorable scenarios, including weaker economic growth and higher inflation, are now more likely than in previous forecasts.
Global trade is expected to weaken in the near term due to geopolitical tensions, rising trade barriers, and ongoing disruptions in supply chains. Fragmentation of trade and tariff increases have been identified as key risks that could further weaken economic activity and reduce output in the long term.
Advanced economies face uneven recovery
In the United States, growth is projected at 2.3 percent in 2026 and 2.1 percent in 2027, which will be supported by domestic demand and fiscal measures, although trade barriers continue to put pressure on activity.
In the euro area, economic growth is expected to remain weak at 0.9 percent in 2026 and one percent in 2027, reflecting weak industrial production and sensitivity to energy prices.
In the United Kingdom, economic growth is projected to slow to 0.8 percent in 2026 and then rebound to 1.3 percent in 2027. In the report, the slowdown in growth in 2026 is attributed to the war and the slower pace of monetary policy easing, while the economic recovery in 2027 remains slower than expected before the war, as the effects of higher energy prices persist.
As for Japan, the IMF said growth is projected at 1.2 percent in 2026 and 1.2 percent in 2027. Japan
