In its World Economic Outlook Update (WEO Update) of January 2026, the International Monetary Fund (IMF) expects the global economy to grow by around 3.3% in 2026. The forecast is thus in line with the previous year and reflects, for example, the assumption of further easing in inflation alongside moderate global growth. While the IMF anticipates an overall stabilization of global economic development, it continues to highlight significant differences between countries and regions, as well as elevated uncertainty.
According to the IMF, Europe is likely to continue to be characterized by subdued growth in 2026, due to ongoing structural challenges. These include the continued effects of high energy prices, a transforming industrial base, demographic factors and Europe’s limited participation in global, technology-driven investment dynamics, particularly in the field of artificial intelligence. For the eurozone, the IMF expects gross domestic product (GDP) to rise by 1.3% in 2026, including GDP growth in Germany of 1.1%. For the UK, the IMF expects GDP to increase by 1.3%.
For the USA, it expects GDP growth of 2.4% in 2026, citing fiscal stimuli, favorable financing conditions and sustained high investment in the technology sector.
According to the IMF, Japan’s economy is expected to record moderate GDP growth of 0.7% in 2026.
For India, the IMF once again expects a high GDP growth rate of 6.4%. Continued strong development is also expected in China as a result of ongoing fiscal policy support, with the IMF estimating GDP growth of 4.5%.
In other emerging and developing countries, the IMF expects solid economic development in 2026, albeit at lower growth rates than in 2025 in some cases. In Brazil, for example, it still only anticipates a 1.6% increase in GDP.
The IMF’s forecast for 2026 is based on the assumption of generally moderate and stable macroeconomic conditions. It expects inflation rates to decline further and financing conditions to be predominantly supportive of growth, although the pace of monetary easing is expected to vary among major economies. Energy prices are generally expected to decline over the course of the year, supported by subdued global demand and an adequate supply.
At the same time, the IMF also points toward a number of opportunities and risks. Positive momentum could arise from persistently high investment activity in the technology sector, particularly in connection with artificial intelligence, as well as from a sustained easing of trade tensions. By contrast, considerable downside risks remain, such as geopolitical conflicts, a renewed tightening of protectionist measures and uncertainties regarding the sustainability of technology-driven investment. In addition, high public debt and unexpected inflation setbacks could lead to more restrictive financing conditions and hamper global economic development.
