The International Monetary Fund (IMF) will hold a press conference on October 13 to present the October 2026 edition of the World Economic Outlook.
In a summary of this new edition released on Monday, the IMF indicated that global economic activity has shown resilience.
“Geopolitical disruptions have had damaging effects, which have nevertheless been mitigated by the momentum provided by technology, cushions, and adaptation measures. Global growth is expected to slow to 3.1% in 2026 before rebounding to 3.4% in 2027. Globally, overall inflation is projected to rise notably, to 4.7% in 2026, before easing to 4.1% in 2027,” the IMF said.
And it added that energy-importing economies not integrated into the technology value chain face the most challenging outlook.
But the adjustment margins that helped drive resilience have limits, and risks are tilted to the downside.
The IMF noted that a renewed escalation of conflicts, a reassessment of expectations raised by artificial intelligence (AI), a resurgence of trade tensions, and factors of budgetary vulnerability could slow growth.
Conversely, stronger investment in AI and the productivity gains it generates, or a durable easing of geopolitical and trade tensions could strengthen growth.
Budget frameworks must enable better management of destabilizing shocks and broaden policymakers’ room for maneuver through revenue-focused measures.
Chapter 2 of the new edition of the World Economic Outlook shows that, in the face of a cost-of-living crisis, governments should preserve the price signals and rely mainly on temporary, targeted income support for the most vulnerable.
Chapter 3 shows that the global impact of changes in corporate tax depends on how those changes are financed.
“Tax cuts financed by borrowing support domestic activity, but may come with negative short-term spillovers abroad,” explains the IMF.
In the long run, these effects can prove positive thanks to cross-border knowledge transfers, but revenue shortfalls can constrain national public investment, particularly in emerging and developing countries.
