The global economy has shown greater resilience than expected despite multiple shocks, IMF Managing Director Kristalina Georgieva said Wednesday, projecting only a modest slowdown in global growth this year and next.
Previewing the World Economic Outlook, Georgieva highlighted that the US economy avoided the recession feared six months ago, thanks to stronger policies, a flexible private sector, milder-than-expected tariffs, and favorable financial conditions.
“Global growth is slowing only slightly. The economy has largely withstood pressures from multiple shocks,” she said.
In July, the IMF raised its growth forecast to 3% for 2025 and 3.1% for 2026, with a full report due next Tuesday during the IMF and World Bank annual meetings.
Georgieva noted that US tariffs have eased, with the trade-weighted rate now 17.5%, down from 23% in April, while most countries avoided retaliatory measures. She cautioned that inflation could rise if higher costs are passed on or redirected goods trigger new global tariffs.
She emphasized that challenges remain, including social marginalization, economic dissatisfaction, and geopolitical risks. “Uncertainty is the new normal,” she said, urging nations to boost productivity, consolidate fiscal spending, and build reserves for future crises.
The IMF chief recommended Europe advance toward a unified market, the United States reduce federal debt, and China increase social spending, stabilize real estate, and cut industrial policy costs.