IMF Lowers Global Trade Growth Estimates By Half In 2026 Due To Trump Tariffs

The global economic order is being reset — and the numbers tell the story. In the IMF's latest World Economic Outlook update, Research Director Pierre-Olivier Gourinchas reveals a stark new landscape: surging tariffs, heightened policy uncertainty, and trade tensions that are beginning to choke global growth. Since January 2025, a wave of tariff announcements — culminating on April 2nd with near-universal levies from the United States — has driven the effective U.S. tariff rate to its highest level in over a century. In response, trading partners have fired back with tariffs of their own. What does this mean for global growth? The IMF now forecasts global GDP growth at just 2.8% in 2025, and 3% in 2026 — a downgrade of 0.8 percentage points from its January forecast. Global trade growth is expected to be slashed by more than half, from 3.8% last year to a mere 1.7% this year. Even with a temporary pause in some tariffs, the economic outlook remains cloudy. Inflation persists slightly higher, and all global regions face a slowdown.