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2d ago

IMF Raises 2025–26 Global Growth Forecast on Tariff Relief, Flags Lingering Risks

Attributing the upgrade to pre-tariff import surges following softened levies, the report warns that forthcoming tariff increases accompanied by broader economic strains could curb growth.

Pierre-Olivier Gourinchas, IMF economic counsellor and director of research, speaks during a news conference on the IMF's Monetary Policy and Financial Stability in Inflationary Times, during the IMF/World Bank Group Spring Meetings at the IMF headquarters in Washington, DC, on April 23, 2025.
A bird flies across central Mumbai's financial district skyline, India, June 18, 2019. REUTERS/Francis Mascarenhas/File Photo

Overview

  • The IMF lifted its global GDP outlook by 0.2 percentage point to 3.0% for 2025 and by 0.1 point to 3.1% for 2026 compared with its April projections.
  • United States growth forecasts were raised to 1.9% in 2025 and 2.0% in 2026, reflecting tariff rollbacks and New Deal–style tax cuts.
  • China’s expansion estimate jumped to 4.8% for 2025 after stronger-than-expected first-half output and lower-than-anticipated U.S. levies.
  • A temporary boost from businesses front-loading imports ahead of August’s tariff hike provided the main lift but is set to reverse and drag on later activity.
  • Major risks highlighted include the prospect of tariff rebounds, heightened geopolitical tensions and rising fiscal deficits that may raise borrowing costs.