The world economy is projected to grow faster this year than previously expected, the International Monetary Fund said on Monday, as surging investment in artificial intelligence and other technology is poised to offset the headwinds of rising protectionism.
In its latest World Economic Outlook, the I.M.F. forecast that global output will hold at 3.3 percent for a third consecutive year. The estimate is 0.2 percentage points higher than the fund’s prediction in October, but growth is expected to slow to 3.2 percent in 2027. Global inflation is expected to ease this year to 3.8 percent, from 4.1 percent in 2025.
“The global economy is shaking off the trade and tariff disruptions of 2025 and is coming out ahead of what we were expecting before it all started,” Pierre-Olivier Gourinchas, the I.M.F.’s chief economist, told reporters ahead of the report’s release.
The projections underscore the resilience of a global economy that has been rocked by wars in the Middle East and Ukraine and destabilized by President Trump’s move to enact steep tariffs on most of America’s trading partners. They also come at a time of heightened uncertainty about the U.S. economy, as the Trump administration is infringing on the independence of the Federal Reserve and the Supreme Court is preparing to issue a ruling that could overturn many of the tariffs that Mr. Trump imposed on national security grounds.
Mr. Gourinchas said the investment boom in artificial intelligence, along with more accommodating financial conditions around the world, was supporting growth. He noted that Mr. Trump’s tariffs, which many expected to be a major drag on the global economy, had been watered down by exemptions, deals and delays.
“The trade shock itself has been lower than initially projected,” Mr. Gourinchas said.
Most of the upgrade to this year’s forecast stems from stronger growth projections in the United States and China, the world’s largest economies.
Output in the United States is being buttressed by a boom in technology investment, which has increased to its highest level since 2001 as a share of overall economic output. Those investments, new tax cuts and lower interest rates are expected to help the U.S. economy grow 2.4 percent this year, up from 2.1 percent in 2025.
In China, the I.M.F. projects that lower tariff rates and fiscal stimulus measures enacted by the central government will help output reach 4.5 percent this year. That is slower than the 5 percent growth in 2025 but stronger than the fund’s October estimate of 4.2 percent. China’s economy, which has been slowed by weak consumer sentiment and a faltering housing market, is expected to slow further in 2027.
Overall, growth in advanced economies is projected to be 1.8 percent this year, while output in emerging markets and developing economies is expected to hover just above 4 percent.
The fund said a pullback in A.I. investment, flaring trade tensions and a global conflict that disrupted energy prices could threaten the outlook.
The I.M.F. is also closely watching how the Supreme Court rules on Mr. Trump’s tariffs, Mr. Gourinchas said. It is not clear how the Trump administration might replace those tariffs if the court rules that they were imposed illegally or what would happen to investment decisions that countries based on negotiations involving those levies.
“It would inject another dose of trade policy uncertainty into the global economy,” Mr. Gourinchas said.
He added that the ruling would also have implications for fiscal policy because the United States had become more reliant on tariffs as a source of revenue.
The future of the Fed could also be a wild card for the global economy. Mr. Trump is preparing to name a replacement for Jerome H. Powell, the current chair. The administration’s move to open a criminal investigation into Mr. Powell this month suggested that Mr. Trump was escalating his effort to ensure that the central bank complied with his demands to cut interest rates further.
Mr. Gourinchas said threats to the central bank’s independence in general could lead to higher inflation expectations and ultimately higher prices, explaining that maintaining the integrity of the Fed is crucial for the global economy.
“Central bank independence is absolutely paramount when it comes to maintaining macroeconomic stability, financial stability and providing an anchor for a sustainable growth,” he said, noting the importance of the U.S. economy. “It’s even more important that somehow the Federal Reserve be able to do its job and do it well.”
Alan Rappeport is an economic policy reporter for The Times, based in Washington. He covers the Treasury Department and writes about taxes, trade and fiscal matters.
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