IMF nudges up growth forecasts amid risks

The In­­ternational Monetary Fund (IMF) on Tuesday raised its global growth forecasts for 2025 and 2026 slightly, citing stronger-than-expected purchases ahead of an Aug 1 jump in US tariffs and a drop in the effective US tariff rate to 17.3pc from 24.4pc. It warned, however, that the global economy faced major risks including a potential rebound in tariff rates, geopolitical tensions and larger fiscal deficits that could drive up interest rates and tighten glo­bal financial conditions. “The world economy is still hurting, and it’s going to continue hurting with tariffs at that level, even though it’s not as bad as it could have been,” said Pierre-Olivier Gourin­chas, IMF chief economist. In an update to its World Economic Outlook from April, the IMF raised its global growth forecast by 0.2 percentage point to 3.0pc for 2025 and by 0.1 percentage point to 3.1pc for 2026.