IMF forecasts

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27 Apr 2025

As of April 2025, the International Monetary Fund (IMF) has released its latest World Economic Outlook, highlighting a cautious global economic environment influenced by trade tensions, demographic shifts, and varying regional performances.

🌐 Global Economic Outlook

The IMF has revised its global growth forecast downward to 2.8% for 2025 and 3.0% for 2026, marking a significant decrease from earlier projections of 3.3%. This adjustment is primarily attributed to the resurgence of protectionist trade policies, notably the substantial tariffs imposed by the United States under President Donald Trump, which have disrupted global supply chains and heightened economic uncertainty. (US and global economic outlook deteriorates in Trump trade war, IMF says, Trump's trade shock hits the global economy)
In addition to trade issues, the IMF underscores long-term concerns related to global aging. The increasing average age worldwide is expected to reduce global growth from 3.6% to 2.5%, particularly impacting advanced economies. However, the IMF notes that policies promoting lifelong health and employment for older adults could mitigate these effects. (Must older mean slower for economic growth?)

🇮🇳 India's Economic Performance

India stands out as a bright spot in the global economy. The IMF has upgraded India's GDP growth forecast to 7% for FY2024-25, up from the previous estimate of 6.8%. This revision reflects better-than-expected growth in 2023 and improved private consumption, especially in rural areas. The IMF maintains a growth projection of 6.5% for FY2025-26, suggesting a moderation as pent-up demand from the pandemic subsides. ([PDF] India Shines as IMF raises GDP forecast to 7% in FY25 - PIB, IMF raises India's FY25 growth projection to 7% - IndBiz, IMF retains India's GDP growth forecast at 7% for FY25, 6.5% for FY26)

🇺🇸 United States and 🇨🇳 China: Slowing Giants

The United States is projected to experience a slowdown, with growth forecasts reduced to 1.8% in 2025 and 1.7% in 2026, down from 2.8% in 2024. The IMF attributes this deceleration to increased policy uncertainty, reduced consumer demand, and ongoing trade tensions. (The IMF just slashed its global growth outlook — and said the US will be hit hard in the trade war)
China's growth forecast has also been lowered to 4%, reflecting the impact of retaliatory tariffs and internal economic challenges. These adjustments underscore the broader implications of the U.S.-China trade war on global economic stability. (US and global economic outlook deteriorates in Trump trade war, IMF says)

🇬🇧 United Kingdom: Confidence at Historic Lows

In the United Kingdom, economic confidence has plummeted to its lowest recorded level since 1978. A recent poll indicates that 75% of Britons expect economic conditions to worsen over the next year. This pessimism coincides with the IMF's downgrade of the UK's growth forecast to 1.1% from 1.6%, influenced by global trade tensions and domestic economic policies. (UK's economic confidence lower than in crash, Covid or winter of discontent)

🔮 Looking Ahead

The IMF emphasizes the need for coordinated global efforts to address the challenges posed by protectionist trade policies and demographic shifts. While certain economies like India demonstrate resilience, the overall global outlook remains subdued. Policymakers are encouraged to implement strategies that promote inclusive growth, support aging populations, and foster international cooperation to navigate the complex economic landscape ahead.
For a more detailed analysis, you can access the full IMF World Economic Outlook report here: IMF World Economic Outlook, April 2025