The International Monetary Fund (IMF) estimates a decline in the global economy and downside risks are intensifying as significant changes in policies occur.

After enduring a prolonged and unprecedented series of disruptions, the global economy seemed to have stabilized, with steady, albeit disappointing, growth rates. However, the outlook has changed as governments around the world reorganize their policy priorities and uncertainty has reached new highs. Global growth forecasts have been notably revised downward compared to the January 2025 update of the World Economic Outlook (WEO), reflecting effective tariff rates at levels not seen in a century and a highly unpredictable environment. Overall global inflation is expected to decrease at a slightly slower pace than anticipated in January.

The intensification of downside risks dominates the outlook amid escalating trade tensions and adjustments in financial markets. Divergent and rapidly changing policy stances, or a deterioration of confidence, could lead to even more restrictive global financial conditions. The escalation of the trade war and increased uncertainty surrounding trade policy could further hinder short- and long-term growth prospects. A reduction in international cooperation could jeopardize progress toward a more resilient global economy.