IMF Lifts Growth Outlook, Warns on Risks

The International Monetary Fund (IMF) has raised its global economic growth forecasts to 3.0% for 2025 and 3.1% for 2026, driven by a weaker US dollar, improved financial conditions, and fiscal expansion in major economies. The IMF cites easing trade tensions, including a temporary reduction in US-China tariffs and less severe US tariff implementations, as supporting factors. China's 2025 growth outlook was sharply upgraded to 4.8% on strong exports and fiscal stimulus, while the US, Eurozone, and India also saw improved prospects. Global inflation is expected to decline to 4.2% in 2025 and 3.6% in 2026, although US inflation may remain above target. The IMF warns that fiscal vulnerabilities and political interference in central bank independence pose ongoing risks to financial stability. Despite the improved outlook, global growth remains below pre-pandemic levels and vulnerable to renewed trade or financial shocks.