IMF Upgrades Global Growth Estimate To 3%, Cautions On Trade Shocks & Fiscal Strains

Pierre-Olivier Gourinchas, IMF’s Chief Economist, delivered a sharp warning on the global economy’s fragility. While global growth projections were slightly upgraded to 3% for 2025 and 3.1% for 2026, he stressed that this resilience is “tenuous.” The temporary pause on U.S. tariffs and easing trade tensions with China gave short-term relief—but tariffs remain historically high, and uncertainty looms large. Gourinchas cautioned that without comprehensive trade agreements, growth could dip again, and fiscal vulnerabilities in many nations leave them exposed to financial shocks. He called for stable trade rules, central bank independence, and structural reforms to boost long-term productivity.