The International Monetary Fund has raised its forecast for global economic growth in 2026, while warning that debt pressures, geopolitical conflict and trade tensions are creating a more fragile outlook for countries outside the main technology economies.
In its World Economic Outlook, released earlier in October, the IMF projected that global real GDP would expand by approximately 3.1% this year. The estimate is up from the Fund’s July forecast of 3% and reflects an expectation that strong investment in artificial intelligence will help counter the effects of energy shocks linked to regional conflicts.
The IMF’s forecast for 2027 is 3.4%, unchanged from its July projection but 0.2 percentage point higher than the estimate issued in April. Even with the improvement, the 2026 outlook remains below the 3.5% growth the Fund projected for 2025.
Four priorities for a more resilient economy
The Fund said governments and international institutions need to pursue four areas of cooperation to strengthen resilience and support broader prosperity:
- Correcting imbalances in global growth;
- Addressing risks associated with rising debt;
- Advancing artificial intelligence and digital cooperation; and
- Maintaining open international trade.
The IMF said the number of countries falling behind is increasing as debt burdens rise. It also warned that the room for economic adjustment that has helped countries absorb previous shocks is becoming more limited.
Among the risks identified by the Fund are a further escalation of conflicts, a reassessment of expectations surrounding artificial intelligence, renewed trade disputes and financial vulnerabilities. The combination could weaken activity even if current investment in AI continues to support growth.
China and Europe face different pressures
The IMF expects China’s economy to grow 4.5% in 2026 and 4.0% in 2027. The Fund said China is facing the effects of higher oil prices as well as structural challenges weighing on economic activity.
The Eurozone is projected to expand by no more than 1.1% this year. The IMF attributed the weaker performance to high energy costs and subdued consumer confidence, placing the region among the major economies facing pressure from the current global environment.
| Economy or measure | IMF forecast or assessment |
|---|---|
| Global growth, 2026 | 3.1% |
| Global growth, 2027 | 3.4% |
| China growth, 2026 | 4.5% |
| China growth, 2027 | 4.0% |
| Eurozone growth, 2026 | No more than 1.1% |
The Fund said energy-importing economies that remain outside the global technology value chain face the most difficult outlook. These countries have fewer opportunities to benefit from the investment associated with AI while remaining exposed to higher energy costs and tighter financial conditions.
The IMF’s assessment places artificial intelligence at the center of the global growth debate. Investment in the technology is supporting the Fund’s higher 2026 forecast, but the organization also treats a change in market and economic expectations around AI as a downside risk. Its recommendations therefore combine continued digital cooperation with efforts to keep trade open, manage debt risks and reduce disparities in growth.
