Global growth is set to hold at a solid 3.3% in 2026, as an accelerating AI investment wave offsets the drag from elevated U.S. tariffs and geopolitical frictions.
The latest World Economic Outlook update from the International Monetary Fund (IMF) nudges the 2026 forecast up by 0.2 percentage point from October, marking the third consecutive upward revision since mid-2025.
AI drives major economies
The United States remains the main growth engine, with 2026 GDP now projected at 2.4%, lifted by massive spending on data centers, high-end AI chips and grid upgrades, even as growth is expected to ease to 2.0% in 2027.
The IMF estimates that if AI adoption proceeds smoothly, global output could be boosted by up to 0.3% points in 2026 and between 0.1% and 0.8% annually over the medium term.
Global growth remains quite resilient
IMF chief economist Pierre-Olivier Gourinchas said, arguing that the world economy is
shaking off the trade and tariff disruptions of 2025.
Trade shifts and regional winners
Effective U.S. tariff rates are now assumed at about 18.5%, down from roughly 25% in April 2025 as new trade deals and tweaks to President Donald Trump’s tariff package take hold. China’s 2026 growth is forecast at 4.5%, after a stronger-than-expected 5% in 2025, helped by a temporary cut in U.S. tariffs and diversifying exports toward Southeast Asia and Europe.
The euro area is seen expanding 1.3% in 2026 and 1.4% in 2027, supported by higher public spending in Germany and firm momentum in Spain and Ireland, while Japan benefits from fresh fiscal stimulus and Brazil slows to 1.6% amid tighter policy to tame inflation.
Global inflation is projected to ease from 4.1% in 2025 to 3.8% in 2026 and 3.4% in 2027, giving central banks more scope to shift toward looser monetary settings.
What comes next?
In the case where AI usage is projected to steadily increase alongside a negative trend in inflation, the IMF foresees that the optimistic scenario would include global economic expansion progressively extending past all projections, particularly in the economies that are technologically and reform-intensive.
However, since tariff rates are still high compared with the situation before the trade-war, and political instability still looms, the strategic choice available to investors and policymakers is a limited one: to use AI-based productivity gains without triggering financial bubbles.
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