IMF Reports global economy projected to grow 3.1% this year
The global economy is projected to grow 3.1% this year and 3.4% next year, though the outlook is becoming increasingly uneven across countries, according to a report released by the International Monetary Fund in Bangkok, Thailand.
Uneven Growth Driven by Artificial Intelligence and Energy Divides
Countries benefiting from an artificial intelligence-driven investment boom or favorable terms of trade are performing relatively well, mediacenter.imf.org reported during the IMF-World Bank Annual Meetings. At the same time, many energy-importing and lower-income economies face a much more challenging environment.
Global inflation is expected to reach 4.7% this year, largely reflecting higher energy and food prices. Deniz Igan, division chief at the IMF’s Research Department, stated that the global economy continues to prove resilient, but the margins of adjustment that helped absorb recent shocks are rapidly narrowing.
This dynamic keeps risks to the outlook tilted to the downside. Persistent or escalating tensions in the Middle East could keep energy and food prices elevated, adding pressure on growth and inflation. Additional risks stem from rising sovereign bond yields and renewed trade tensions.
Policy Tradeoffs and the Dual Risks of Artificial Intelligence
Risks surrounding artificial intelligence remain two-sided. Expectations around the technology could prove too optimistic, leading to financial market corrections, or upside possibilities could emerge if AI-driven productivity gains materialize sooner rather than later.
Policymakers face difficult tradeoffs in managing these shocks without losing sight of medium-term stability. The IMF advises countries to rebuild fiscal space without further delay given high debt levels and rising borrowing costs. Support for households facing higher food and energy prices should remain temporary, targeted, and non-distortionary.
Monetary policy should stay data-dependent and tailored to country circumstances, accounting for exposures to war disruptions and technology upturns. Over the long term, strengthening energy security, improving AI readiness, and preserving open trade and cooperation will be essential. Further details and data tables are available directly through the World Economic Outlook Reports.