The International Monetary Fund (IMF) released its January World Economic Outlook, forecasting global economic growth of 3.3% for both 2025 and 2026. The 2025 projection marks a slight upward revision of 0.1 percentage point compared to the IMF’s October estimate, while the 2026 outlook remains unchanged.
Advanced Economies: Steady Expansion
Advanced economies are expected to grow by 1.9% in 2025 and 1.8% in 2026, aligning closely with prior projections.
- United States:
The U.S. economy is forecast to expand by 2.7% in 2025, a 0.5-point upward revision driven by strong labor markets, robust investment, and favorable financial conditions. Growth is projected to slow slightly to 2.1% in 2026, reflecting sustained underlying demand.“In the U.S., underlying demand remains robust, reflecting strong wealth effects, a less restrictive monetary policy stance, and supportive financial conditions,” the IMF stated.
- Euro Area:
Growth in the eurozone is expected to slow to 1% in 2025, revised down from 1.2%, due to weaker manufacturing activity and heightened uncertainty. However, growth is anticipated to accelerate to 1.4% in 2026 as financial conditions ease and confidence improves.- Germany’s growth estimates were notably reduced, with 2025 now projected at 0.3% (down 0.5 points) and 2026 at 1.1% (down 0.3 points).
Emerging Markets and Developing Economies
Emerging market and developing economies are set to grow at 4.2% in 2025 and 4.3% in 2026, reflecting broad stability in projections.
- China:
China’s economy is forecast to grow by 4.6% in 2025, up 0.1 points, supported by fiscal stimulus and policy measures. Growth in 2026 is expected to hit 4.5%, a 0.5-point upward revision as trade policy uncertainty wanes and labor supply concerns stabilize. - India:
India’s GDP is projected to grow consistently at 6.5% in both 2025 and 2026, maintaining its position as a global growth leader. - Türkiye:
Türkiye’s growth projection for 2025 was slightly raised to 2.6%, a 0.1-point upward revision, with 2026 growth remaining steady at 3.2%.
Inflation Outlook
Global headline inflation is projected to decline to 4.2% in 2025 and further to 3.5% in 2026, reflecting easing price pressures and stabilizing supply chains.
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