IMF raises 2026 global growth forecast to 3.1% amid AI investment boost

Global Growth Forecasts

The International Monetary Fund has projected global economic growth of 3.1 percent for 2026, up from its July estimate of 3.0 percent, and noted that this compares with the 3.5 percent growth recorded in the preceding year.

The forecast was released in the World Economic Outlook report issued today, coinciding with the annual meetings of the IMF and the World Bank being held in Bangkok, Thailand.

The Fund also projected global economic growth of 3.4 percent for 2027, unchanged from its July estimate and representing an increase of 0.2 percentage points over the forecast issued in April.

AI Investment Impact

The IMF attributed the slight improvement in growth forecasts to continued strong investment in artificial intelligence infrastructure, which helped offset part of the negative effects of rising energy prices and contributed to better growth estimates for a number of advanced economies and countries taking part in technology production chains.

It pointed out that South Korea, Malaysia, Mexico and Thailand have benefited from rising demand for devices and components used in developing AI technologies, alongside the advanced economies that develop the platforms and infrastructure for this technology.

The Fund warned of a widening gap between economies that gain from AI investment and those that do not, noting that only 32 countries now account for about 95 percent of global economic growth, down from 54 countries in the April estimates.

It added that downward revisions to growth forecasts have become more widespread, having lowered its estimates for roughly 47 percent of economies since the April forecasts were issued, including several energy‑importing countries that do not participate in AI‑linked value chains.

Inflation and Public Debt

On inflation, the IMF expects the headline consumer price index to reach 4.7 percent in 2026 before falling to 4.1 percent in 2027, with upward price pressures linked to the AI investment boom expected to persist.

Concerning public finances, it warned that rising levels of public debt, especially in advanced economies, increase the risk of sharp jumps in borrowing costs and could undermine economic growth amid ongoing financial and geopolitical volatility.

The Fund urged governments to “not postpone the necessary measures to rebuild reserves and fiscal buffers that enable them to confront future crises, while putting in place credible medium‑term plans to return public debt to sustainable levels.”

Regional Relevance

The outlook is especially pertinent for Arab economies that rely on energy exports and are expanding their artificial intelligence capabilities.