The International Monetary Fund (IMF) says the global economy remains resilient despite the shock from the recent war, but warns that inflation remains a concern. In its July update to the World Economic Outlook, the IMF kept its medium-term growth projections broadly unchanged while noting that progress in bringing down inflation has stalled.
The IMF says global growth is expected to reach 3% in 2026 and 3.4% in 2027, reflecting what it describes as a recovery from the economic impact of the war.
Source: IMF, World Economic Outlook Update, July 2026. Table created by the INC using published data.
“We are projecting global growth of 3% in 2026 and 3.4% in 27, broadly unchanged from April on a cumulative basis,” commented Petya Koeva Brooks, Deputy Director of the IMF Research Department. “In effect, we expect a V-shaped recovery, weaker growth this year relative to our pre-war forecast, followed by a rebound next year.”
While growth is holding up, inflation is proving more persistent. The IMF says the global disinflation trend that began in early 2024 has now stalled, prompting an upward revision to its inflation forecast for this year.
“On inflation, the picture is somewhat less encouraging,” said Brooks. “Global headline inflation has been revised up to 4.7% this year, while our core inflation forecast is broadly unchanged. Put simply, the disinflation trend that has been in place since early 2024 has stalled.”
Even so, the IMF says the global economy has weathered the impact of the war better than initially feared. “The world economy has weathered the shock from the war better than feared so far, with limited evidence of second-round effects,” added Brooks. “A larger spike in oil prices was avoided thanks to inventory drawdowns, expanded production outside the Gulf in actions to help soften oil demand. And a steady rise in the renewable energy share, combined with lower energy intensity than just a few years ago, has also made many economies more resilient. And while financial conditions tighten sharply in early April, they have since eased and remained supportive by historical standards.” More information
Economic Pressures on US Farmers Expected to Persist Into 2027
US farmers are expected to continue facing difficult economic conditions in 2027 as high production costs, lower commodity prices and market uncertainty continue to affect profitability. According to an analysis by the American Farm Bureau Federation (AFBF), financial pressures remain widespread across both row crops and specialty crop sectors.
The organization noted that producers of specialty crops continue to face significant challenges as labor, input, compliance and capital costs remain elevated. Industry representatives indicated that market conditions have shown limited improvement during 2026, while many producers continue to operate under tight margins. The findings prompted the AFBF to issue renewed calls for economic assistance and longer-term policy measures aimed at supporting US agriculture.
