IMF warns of rising global debt, economic slowdown due to US tariffs

The International Monetary Fund (IMF) has significantly lowered its global growth forecasts due to the escalation of US-led tariff policies and the ensuing trade war, particularly between the United States and China. The IMF now expects global economic growth to slow to 2.8% in 2025, with further reductions possible if recent tariff announcements are made permanent. Public debt is projected to rise sharply, potentially surpassing 95% of global GDP this year and nearing 100% by 2030, as governments contend with weakened growth prospects, increased market volatility, and rising financing costs. Major economies, including the US, Germany, and Canada, have seen their growth outlooks notably reduced, with Canada’s 2025 forecast cut to just 0.6%. The IMF warns that heightened uncertainty, compounded by increased defense spending and foreign aid cuts, has complicated fiscal planning and increased the risk of recession, especially in the US. Policymakers are urged to address these challenges to mitigate further economic disruptions stemming from ongoing trade tensions.