IMF Still Sees Growth, but the World Is Entering an Increasingly Uneven Economic Period
The International Monetary Fund, in its latest January update of the world economic outlook, does not speak of a global recession, but neither does it offer a picture of a broad-based recovery. According to the IMF’s estimate, the world economy should grow at a rate of 3.3 percent in 2026 and 3.2 percent in 2027, after an estimated 3.3 percent in 2025. At first glance, this appears to be proof of surprising stability, especially after strong trade tensions and political uncertainty that marked the previous period. But beneath that average figure lies a far more complex reality: growth is still present, but it is increasingly concentrated in certain countries, sectors, and types of investment, while much of the world continues to feel the consequences of costly borrowing, weaker productivity, and political risks.
That is precisely why the current picture cannot be described either as a pure crisis or as a clear recovery. It is an uneven cycle in which technological momentum, especially investment linked to artificial intelligence, supports investment and financial markets, while at the same time trade divergences, geopolitical pressures, and rising indebtedness limit broader and more even acceleration. The IMF openly warns that risks remain tilted to the downside, even as short-term projections show resilience.
Growth exists, but it is not broadly distributed
The key message of the IMF’s latest report is that the global economy is, for now, withstanding shocks better than had been expected earlier. Compared with the autumn projection from October 2025, the estimate for 2026 has been slightly raised. In Washington, they explain this through a combination of stronger technological investment, milder financial conditions, fiscal and monetary support in certain economies, and the surprising adaptability of the private sector, which managed to keep supply chains functional even under conditions of intensified trade restrictions. In other words, companies adapted faster than many had expected, and part of the economic shocks was cushioned by an investment cycle linked to digital infrastructure, semiconductors, data centers, and artificial intelligence.
Such growth, however, is not distributed equally. In January, the IMF emphasizes that the current momentum is largely concentrated in several sectors, above all in information technology and activities related to artificial intelligence, and in several large economies that benefit the most from that wave. In practice, this means that the average is lifted by countries and industries that have the capital, technological base, and institutional capacity for rapid adaptation, while many other economies remain significantly more vulnerable to external shocks. It is precisely in that difference between aggregate growth and the actual distribution of benefits that lies the reason why the IMF speaks of a persistent but divided global expansion.
Technology and consumption keep optimism alive
According to the IMF, one of the main pillars of current optimism is investment in technology. Demand for technological equipment and infrastructure, especially in the artificial intelligence segment, produces positive spillover effects on suppliers in Asia and on investment sentiment in advanced economies. In the United States, that wave is particularly strong: in January, the IMF states that the American technological surge is precisely one of the reasons why the growth projection for that country was revised upward, to 2.4 percent in 2026, after an estimated 2.1 percent in 2025. At the same time, American inflation is expected to decline toward target levels more slowly than in other major economies, partly because part of the tariff cost is only gradually being passed on to final prices.
More resilient consumption is the second important element of that story. In several economies, private consumption remained stronger than expected, primarily where real incomes strengthened due to easing inflation or where labor markets remained relatively firm. This is also visible in the example of Spain, for which the IMF in January raised the growth estimate to 2.3 percent, highlighting strong private consumption, investment, and the resilience of the services sector, including tourism. A similar pattern is visible in India, where the IMF estimates that growth reached 7.3 percent in 2025, while in 2026 it should amount to 6.4 percent, with strong domestic consumption and solid indicators from the rural economy.
Still, optimism based on technology and consumption is not the same as balanced global development. While capital and investment are flowing into sectors with high expected returns, many countries with higher debt and less fiscal space do not have the same opportunities. The IMF therefore warns that even economies not directly involved in the technological boom could feel the consequences of a possible reversal, through weaker external demand, more expensive financing, and the transmission of instability from global capital markets.
Trade tensions have not disappeared, they have only been temporarily eased
One of the reasons why the global economy in 2026 is not being described in dramatic terms is the fact that some of the previously announced trade shocks did not materialize in full scope. In its statements after the release of the report, the IMF notes that some of the more extreme threats of higher tariffs during 2025 were mitigated by subsequent agreements and the temporary calming of conflicts among major trading blocs. This helped ensure that the immediate effect of the tariff shock was smaller than initially feared.
But that does not mean the problem has been solved. On the contrary, the IMF makes it very clear that trade tensions remain one of the main sources of instability. The mere fact that companies and investors must adapt to changing rules, threats of new tariffs, export restrictions on critical raw materials, and politically motivated trade moves acts as a brake on investment. Such uncertainty is bad for business decisions, encourages caution, and can increase the tendency toward saving instead of investing. The IMF therefore stresses that the predictability of the trading system is almost as important as the tariff level itself.
The World Bank sends a similar message. In its January report Global Economic Prospects, it points out that the world economy has shown resilience despite historically high trade tensions and political uncertainty, but warns that the recovery among economies has remained disappointingly uneven. The World Bank projects global growth of 2.6 percent in 2026 and emphasizes that one in four developing economies is still poorer than in 2019, which shows how far the global picture actually is from an even recovery.
China, the United States, and India are pulling the average, but for different reasons
When the world’s largest economies are observed, the differences are even more visible. In the United States, the combination of strong technological investment, more favorable financial conditions, and solid investment activity continues to support growth. However, the IMF warns that some inflationary pressures may still spill over to consumers and that the American economy is not immune to the consequences of trade measures that have so far been partly absorbed by the companies themselves.
China, on the other hand, according to the data cited by the IMF, recorded growth of 5 percent in 2025, while 4.5 percent is expected for 2026. But behind those figures stands a different structure of problems. The Fund warns that the Chinese growth model still depends too much on the external sector and production, while domestic demand and consumption remain relatively weak. Low inflation, which in China remains around very modest levels, is for the IMF a sign that domestic demand is not strong enough. That is why the Fund says that strengthening consumption, resolving problems in the real estate sector, and achieving a more balanced growth model would be more important than merely maintaining high production rates.
India is a separate case in that picture. There, growth continues to remain among the highest in the large economies, and the IMF links it to stronger private consumption, falling inflation, and more favorable developments in the rural sector. This shows that the divergence of the global economy is not only a difference between advanced and emerging markets, but also a difference within each of those groups: some countries have room for strong growth, while others struggle with slowdown, debt, and a weak investment cycle.
Inflation is easing, but not at the same pace
Alongside growth, the other major question remains inflation. According to the IMF’s January estimate, global inflation should fall from an estimated 4.1 percent in 2025 to 3.8 percent in 2026 and to 3.4 percent in 2027. This confirms that the post-pandemic and energy inflation shock is gradually subsiding, but the path toward central bank targets remains uneven. In some major economies, pressures are easing relatively quickly, while in the United States the outlook for returning to target is slower.
That divergence matters because it affects interest rates, financing conditions, and investment decisions. Where inflation remains more stubborn, central banks have less room for a rapid easing of monetary policy. Where the easing is more convincing, financial conditions can become milder, which further supports domestic demand and credit activity. Precisely because of this, the IMF stresses the importance of credible and independent central banks, warning that weakening their independence could once again raise inflation expectations and undermine market confidence.
The greatest threat is concentrated growth
Perhaps the most important warning in the IMF’s latest tone is not related to the growth rate itself, but to its structure. The Fund warns that the current momentum is concentrated in a few sectors, especially IT and artificial intelligence, and that such concentration in itself creates vulnerability. If expectations about productivity and profitability in the AI sector are too high, a sharp reassessment of valuations is possible, especially in the American capital market, where the technology sector is exceptionally large and systemically important.
The IMF also recalls that a moderate correction in the valuations of shares linked to artificial intelligence, combined with tighter financial conditions, could reduce global output by 0.4 percent in 2026. On the other hand, if productivity gains do indeed materialize, the world economy could receive an additional boost of around 0.3 percent. That is perhaps the best summary of the current state: the same factor that supports optimism today may tomorrow become a channel of instability.
The risk is not only market-related. The IMF also warns that financing the expansion of the technological cycle is increasingly relying on debt, which means that disappointment in returns could have broader consequences for credit markets, consumption, and international capital flows. Since foreign investors are holding American assets to an increasing extent, any correction would not remain confined within a single market, but would spill over to the rest of the world as well.
What this means for the rest of the world
For small and medium-sized economies, including those that are not at the center of the technological wave, the message is fairly clear. The global average may look stable, but that does not mean the risks are smaller. Countries with high public debt, limited fiscal space, and weaker productivity remain vulnerable to changes in borrowing costs, weakening export demand, and possible financial shocks. The IMF therefore once again calls for the rebuilding of fiscal buffers, the preservation of price and financial stability, and the continuation of structural reforms.
The OECD, in its Economic Outlook for the end of 2025, offers a similar assessment: the world economy is more resilient than expected, but underlying weaknesses are still present, and growth could slow in 2026 as temporary stimuli are exhausted and the consequences of trade barriers strengthen. This means that today’s resilience does not guarantee longer-term security. Rather, it shows that the global economy is capable of postponing the full effect of shocks, but not of permanently escaping their consequences.
In that sense, the most accurate description of the current moment is neither euphoria nor panic. The IMF still sees growth, but with increasing divergence among countries, sectors, and social groups. Technological investment and more resilient consumption are, for now, keeping global optimism above the level that would accompany a classic slowdown. At the same time, trade disputes, geopolitical risks, the sensitivity of financial markets, and the uneven recovery among countries remain strong enough to prevent a simple story of stable recovery. Thus, at the beginning of 2026, the world economy does not appear to be a system accelerating calmly, but rather a space in which growth is being maintained, though ever more selectively and at an ever higher cost of error.
Sources:- International Monetary Fund – January update of the World Economic Outlook for 2026, with estimates of global growth, inflation, and major risks (link)
- International Monetary Fund – blog accompanying the January report, on the impact of technological investment, trade disruptions, and geopolitical risks (link)
- International Monetary Fund – transcript of the press conference on the January WEO update, with additional explanations on the United States, China, India, Spain, and trade tensions (link)
- World Bank – Global Economic Prospects, January 2026, on the resilience of the world economy and the uneven recovery of developing economies (link)
- OECD – Economic Outlook, end-2025 edition, on the resilience of the global economy, but also persistent weaknesses linked to trade barriers and political uncertainty (link)
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