Overview

• The World Economic Outlook nudges 2025 global growth to 3.2% and leaves 2026 at 3.1%, with the IMF calling prospects steady yet fragile.
• The United States is now projected to grow 2.0% in 2025 and 2.1% in 2026, supported by AI investment, fiscal policy and easier financial conditions even as inflation drifts higher.
• India’s forecast increases to 6.6% for 2025/26, with 2026 trimmed to 6.2%, as strong early‑year momentum offsets higher U.S. tariffs on Indian goods.
• The IMF warns that renewed U.S.–China tensions—after China’s rare‑earth export controls and a U.S. threat of 100% tariffs—could, in severe scenarios, subtract about 1.2 percentage points from global GDP in 2026 and 1.8 points by 2027.
• The fund attributes the smaller‑than‑feared hit so far to exemptions, front‑loaded imports, supply‑chain rerouting, a weaker dollar and an AI boom, while cautioning on potential AI market corrections, central‑bank credibility risks and pressure on vulnerable economies.