The International Monetary Fund (IMF) has forecast that global economic growth will slow from 3.5 percent in 2025 to 3.1 percent in 2026, before recovering to 3.4 percent in 2027, according to its October 2026 World Economic Outlook report.
The IMF maintained its 2026 global growth forecast from April while revising its 2027 projection upward by 0.2 percentage points. Despite the global economy's resilience amid geopolitical conflicts, energy market disruptions and trade tensions, the organization warned that economic and policy buffers are becoming increasingly limited.
Growth in advanced economies is expected to reach 2.1 percent in 2026, before slowing to 1.8 percent in 2027. Meanwhile, emerging and developing economies are projected to expand by 3.7 percent in 2026, down from 4.5 percent in 2025, before recovering to 4.4 percent in 2027.
US economic growth expected to remain at 2.3 percent, while EU and euro area growth remain subdued
The US economy is expected to grow by 2.3 percent in both 2026 and 2027, supported by resilient private consumption, fiscal policies and continued investment in artificial intelligence (AI) and other technologies. US inflation is projected to increase from 2.7 percent in 2025 to 3.6 percent in 2026, before easing to 2.8 percent in 2027.
In the EU, economic growth is forecast at 1.4 percent in both 2026 and 2027, compared with 1.5 percent in 2025. Euro area growth is expected to slow from 1.2 percent in 2025 to 1.1 percent in 2026, before recovering to 1.2 percent in 2027, as higher energy prices and weak consumer confidence continue to constrain economic activity. Euro area inflation is projected to rise to 3.1 percent in 2026 from 2.1 percent in 2025, before declining to 2.8 percent in 2027.
Growth to slow in China and Turkey in 2026, while India maintains strong momentum
China's economic growth is projected to decline from five percent in 2025 to 4.5 percent in 2026 and four percent in 2027, reflecting higher energy prices, prolonged uncertainty and structural economic constraints. Chinese inflation is expected to increase from zero in 2025 to one percent in 2026 and 1.4 percent in 2027.
Meanwhile, India is expected to remain among the fastest-growing major economies, with growth forecast at seven percent in both fiscal years 2026 and 2027, supported by resilient domestic demand and strong services activity. On a calendar-year basis, India's growth is projected at 7.4 percent in 2026 and seven percent in 2027. Indian inflation is expected to increase from 2.0 percent in 2025 to five percent in 2026, before declining to 4.4 percent in 2027.
Regarding Turkey, the IMF expects economic growth to slow from 3.7 percent in 2025 to 2.7 percent in 2026, before recovering to 3.6 percent in 2027. Average consumer price inflation in Turkey is projected to decline from 34.9 percent in 2025 to 31.2 percent in 2026 and 26.5 percent in 2027.
Global inflation expected to rise to 4.7 percent amid higher energy prices
The IMF expects global headline inflation to rise from 4.1 percent in 2025 to 4.7 percent in 2026, mainly due to higher energy and food prices, before declining to 4.1 percent in 2027. The report assumes an average oil price of $95.74 per barrel in 2026, up 41.3 percent from $67.74 per barrel in 2025, before declining to $87.39 per barrel in 2027. Nonfuel commodity prices are expected to increase by 17.3 percent in 2026.
Meanwhile, global trade volume is projected to increase by 4.6 percent in 2026 and 4.7 percent in 2027, supported partly by technology-related trade despite tariffs and the reorganization of international supply chains. The IMF warned that further disruptions to energy supplies, prolonged conflicts, renewed trade tensions, high public debt and tighter global financing conditions could weaken economic activity.
It also highlighted risks associated with the concentration of investment in AI-related industries, noting that a reassessment of expected returns could trigger financial market corrections and lower investment. To strengthen economic resilience, it recommended credible fiscal adjustment, monetary policies focused on price stability and greater diversification of energy supplies, critical technologies and international trade relationships.
