IMF projects global economic growth of 3.1% in 2026

Photo: International Monetary Fund

BAKU, Azerbaijan, October 15. The International Monetary Fund (IMF) projects global economic growth of 3.1% in 2026 and 3.4% in 2027, according to information published on the fund’s website.

Global inflation is expected to reach 4.7% in 2026, mainly driven by rising energy and food prices.

Deniz Igan, division chief in the IMF’s Research Department, said the global economy continued to demonstrate resilience, although growth was becoming increasingly uneven across countries.

“Countries benefiting from the artificial intelligence-related investment boom or favorable terms of trade are performing relatively well, while many energy-importing countries and low-income nations face much more challenging conditions,” she said.

The fund warned that economies’ capacity to absorb new shocks was diminishing, increasing downside risks to the global economic outlook.

According to Igan, tensions in the Middle East could persist or escalate, keeping energy and food prices elevated and putting additional pressure on economic growth and inflation.

She also identified rising sovereign bond yields and renewed trade tensions as other risks. Artificial intelligence could create additional opportunities to boost productivity, but overly optimistic expectations about the technology could also trigger financial market corrections.

Against this backdrop, the IMF called on governments to address immediate shocks without undermining medium-term economic stability.

“Countries need to rebuild fiscal space without further delay, given high debt levels and rising borrowing costs. Any support for households facing higher food and energy prices should be temporary and targeted,” Igan said.

She also stressed that monetary policy should remain data-dependent and tailored to individual countries’ circumstances, including their exposure to conflict-related disruptions and technological change.

In the long term, strengthening energy security, improving readiness for the adoption of artificial intelligence, and preserving open trade and international cooperation will be essential, according to the IMF.