IMF cuts 2026 global growth forecast to 3% amid geopolitical tensions and elevated AI infrastructure capex risks.

The International Monetary Fund (IMF) has revised its global growth projection for 2026 downward to 3 percent, according to a statement reported by QNA. The Fund warned that persistent risks remain from the ongoing war in the Middle East and from possible corrections in market expectations tied to artificial intelligence.

The IMF noted that the global economy avoided a sharper downturn from the conflict because strong demand in the technology sector helped offset the decline in energy supplies linked to the war. It forecast that growth would recover to 3.4 percent in 2027, though that figure remains below the average of 3.5 percent recorded in 2024 and 2025.

The institution raised its inflation projection for the current year by 0.3 percentage points to 4.7 percent, compared with its April forecast. It expects inflation to decline to 3.9 percent in 2027. The IMF also stated that energy prices are currently 25 percent higher than before the war began on February 28 and are expected to remain elevated. It added that the global economy has weathered the shock from the war better than initially feared.

The Fund expressed positive expectations for energy exporters and countries closely integrated with the technology sector. However, it projected lower growth rates for commodity-importing economies that are not well positioned to benefit from developments in artificial intelligence.