Washington: The IMF has raised its global economic growth forecasts to 3% for this year and 3.1% for next year. In the July edition of its World Economic Outlook report, released Tuesday, the IMF growth forecast for the world economy this year is 0.2 percentage points higher than forecasts published in April, and the 2026 forecast is also 0.1 percentage points higher.
According to Anadolu Agency, in the IMF's April forecasts, the world economy was expected to grow by 2.8% this year and 3% next year. The report says the upward revision in growth forecasts reflects stronger-than-expected demand due to expectations of high tariffs, lower average tariff rates than announced in April, improved financial conditions due to the weakening of the US dollar, and fiscal expansion in some major economies.
The report indicates that global headline inflation is expected to decline to 4.2% in 2025 and 3.6% in 2026, aligning with the April forecast. It states that inflation is expected to remain above target in the US, while it is projected to be more moderate in other major economies. The report also highlights that risks to the economic outlook are on the downside and that increases in effective tariff rates could lead to weaker growth.
The report further emphasizes that high levels of uncertainty could begin to pressure economic activity. It warns that geopolitical tensions could disrupt global supply chains and push up commodity prices. Additionally, it notes that larger budget deficits or increased risk aversion could raise long-term interest rates and tighten global financial conditions.
In a positive scenario, the report suggests that global growth could gain momentum if trade negotiations reach a predictable framework and tariffs are reduced. The report also revises Turkey's economic growth forecasts upward, projecting the Turkish economy to grow 3% this year and 3.3% next year.
The report noted changes in growth forecasts for other economies as well. The growth forecast for the US economy for 2025 has been raised from 1.8% to 1.9%, and its forecast for next year has been raised from 1.7% to 2%. The eurozone economy's growth forecast has been increased from 0.8% to 1% for this year, while the forecast for 2026 remains at 1.2%.
Germany's growth forecast for this year has been adjusted from 0% to 0.1%, remaining unchanged at 0.9% for next year. Meanwhile, France's growth forecast for this year remains at 0.6% and 1% for next year. The Italian economy's growth forecast has been raised from 0.4% to 0.5% for this year and kept at 0.8% for next year. Spain's growth forecast remains at 2.5% for this year and 1.8% for next year.
The IMF report also revised the growth forecast for the UK economy, raising it from 1.1% to 1.2% for this year, and maintaining it at 1.4% for next year. Additionally, the growth forecast for the Japanese economy has been increased from 0.6% to 0.7% for this year, while it has been lowered from 0.6% to 0.5% for next year.