The International Monetary Fund (IMF) offers most recent forecast update for the global economy in its October World Economic Outlook. Over the next two years it expects:
- Global growth moderates amid persistent uncertainty: World GDP growth is forecast to slow from 3.5% in 2025 to 3.1% in 2026 before recovering to 3.4% in 2027. Escalating conflicts, AI uncertainty, trade tensions and fiscal risks could weaken global growth.
- Advanced and emerging economies diverge: Growth in advanced economies is projected at 2.1% in 2026 before easing to 1.8% in 2027, while emerging market and developing economies are forecast to slow to 3.7% in 2026 before strengthening to 4.4% in 2027. The United States is expected to maintain growth of 2.3% in both 2026 and 2027, while euro area growth remains modest at around 1.1-1.2%. China's growth is projected to slow from 4.5% in 2026 to 4.0% in 2027.
- Commodity prices surge before easing: Oil prices are forecast to rise sharply by 41.3% in 2026 following a significant decline in 2025, before falling by 8.7% in 2027. Non-fuel commodity prices are also expected to increase strongly in 2026 by 17.3%, before moderating to 2.6% growth in 2027.
- Global inflation remains elevated: World inflation is forecast to rise from 4.1% in 2025 to 4.7% in 2026 before easing to 4.1% in 2027. Inflation is expected to remain higher in emerging economies (5.7%) than in advanced economies (3.1%).
- Australia's growth outlook weakens: Australia's economic growth is forecast to slow from 2.0% in 2025 to 1.9% in 2026 and 1.6% in 2027, lagging both the world economy and other major advanced economies. Slowing domestic growth combined with elevated global inflation and commodity price volatility points to a challenging economic environment over the next two years.
IMF Economic Outlook, selected countries (October 2026)
| |
|
2025 |
2026 |
2027 |
| Real GDP growth, % |
World |
3.5 |
3.1 |
3.4 |
| Advanced economies |
2.0 |
2.1 |
1.8 |
| Emerging market and developing economies |
4.5 |
3.7 |
4.4 |
| Australia |
2.0 |
1.9 |
1.6 |
| United States |
2.3 |
2.3 |
2.3 |
| Euro area |
1.2 |
1.1 |
1.2 |
| China |
5.0 |
4.5 |
4.0 |
| Commodity prices, % |
Oil |
-14.4 |
41.3 |
-8.7 |
| Nonfuel |
9.9 |
17.3 |
2.6 |
| Consumer prices, % |
World |
4.1 |
4.7 |
4.1 |
| Advanced economies |
2.5 |
3.1 |
2.7 |
| Emerging market and developing economies |
5.2 |
5.7 |
5.1 |
