World output is projected to expand by 3.3% in 2026 and 3.2% in 2027, almost unchanged from 2025 levels, as strong investment in technology offsets continuing uncertainty over trade policy.
The Fund noted that inflation is gradually easing, with global headline inflation forecast to fall from 4.1% in 2025 to 3.8% in 2026 and 3.4% in 2027. However, the pace of decline differs widely. Inflation in the United States (US) is expected to return to its 2% target only during 2027, while the euro area is likely to hover around 2% sooner.
Sub-Saharan Africa is among the brighter spots. The region is projected to grow by 4.6% in both 2026 and 2027, supported by macroeconomic stabilisation and reform programmes in major economies. Nigeria’s economy is forecast to expand by 4.4% in 2026, while South Africa is expected to record more modest growth of 1.4%.
Trade remains a central uncertainty. Global trade volumes are set to slow sharply from 4.1% growth in 2025 to 2.6% in 2026 as companies adjust to new tariff regimes. Although recent tensions between China and the US have eased, the IMF warned that fresh sector-specific barriers could disrupt supply chains and lift prices.
Technology investment, particularly linked to artificial intelligence, is the main engine of momentum. Exports of semiconductors and digital equipment from Asian economies have remained strong, helping to balance weaker demand elsewhere. Yet the Fund cautioned that over-optimistic expectations about artificial intelligence productivity could trigger a market correction with global spill-overs.
Fiscal pressures are another concern. Public debt in several large economies is climbing above 100% of gross domestic product, pushing governments to consider credible consolidation plans. Central Banks are urged to keep monetary policy focused on price stability while remaining alert to financial volatility.
For African policymakers, the message is to protect reform momentum and expand productive investment. The IMF emphasised that structural changes in labour markets, education and digital infrastructure could lift long-term growth and help the continent benefit from the ongoing technological transformation.
–IMF/ChannelAfrica–
