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NEWS

US, global economic outlook worsens in the face of Trump's tariffs, IMF says

Updated

The outlooks for the U.S. and global economies have significantly worsened in the wake of President Donald Trump's tariffs and the uncertainty they have created, the International Monetary Fund said Tuesday

President of European Central Bank, Christine Lagarde.
President of European Central Bank, Christine Lagarde.AP

The IMF said that the global economy will grow just 2.8% this year, down from its forecast in January of 3.3%, according to its latest World Economic Outlook. And in 2026, global growth will be 3%, the fund predicts, also below its previous 3.3% estimate.

U.S. economic growth will come in at just 1.8% this year, down sharply from its previous forecast of 2.7% and a full percentage point below its 2024 expansion. The IMF doesn't expect a U.S. recession, though it has raised its odds of one this year from 25% to 37%.

The forecasts are largely in line with many private-sector economists' expectations, though some do fear a recession is increasingly likely. Economists at JPMorgan say the chances of a U.S. recession are now 60%. The Federal Reserve has also forecast that growth will weaken this year, to 1.7%.