IMF lowers global growth forecast for 2026 to 3.0% vs 3.1% in April, raises 2027 forecast to 3.4% vs 3.2%.

The International Monetary Fund revised its estimate for 2026 global growth lower in its World Economic Outlook update released on Wednesday, with downward adjustments for several regions. World output is now expected to expand by 3.0% in 2026 after a 3.5% gain in 2025, a small downward adjustment from a 3.1% gain for 2026 in the April version of the WEO. Growth is expected to accelerate to 3.4% in 2027, an upward adjustment from the April estimate of a 3.2% gain. "The modest slowdown reflects the effects of the war in the Middle East being partly offset by accelerated demand-driven momentum in the global technology cycle thanks to advances in artificial intelligence and its adoption," the IMF said. "The impact varies widely based on countries' exposure to the war and position in the technology value chain." The IMF was moderately less pessimistic about the war impact than they were in the April WEO but still urged caution. "Risks to the outlook are more balanced than in April but still tilted to the downside," the IMF said. "The possibility of renewed Middle East conflict looms large and could extend commodity price volatility, further threaten supply chains, raise prices,.

IMF lowers Euro area growth forecast for 2026 to 0.9% vs 1.1% in April; 2027 forecast unchanged at 1.2%.

IMF lowers Japan growth forecast for 2026 to 0.6% vs 0.7% in April; raises 2027 forecast by 0.1 percentage point to 0.7%