The World Bank reports that the global economy is proving more resilient than expected despite ongoing trade tensions and policy uncertainty.
In its latest Global Economic Prospects report, released Tuesday, the bank forecasts steady global growth over the next two years. Growth is projected to dip slightly to 2.6% in 2026 before edging up to 2.7% in 2027 an upward revision from its June 2025 outlook.
This brighter forecast stems from stronger-than-anticipated performance in several economies, especially the United States, which drives about two-thirds of the adjustment for 2026.
Even so, the report warns that if these projections hold, the 2020s will mark the weakest decade for global growth since the 1960s. Slow growth is exacerbating living standards gaps: by the end of 2025, per capita incomes in nearly all advanced economies will exceed 2019 levels, while about one in four developing economies will still lag behind.
The report credits 2025’s growth to a pre-policy-change trade surge and swift global supply chain shifts, but these tailwinds are expected to wane in 2026 amid softer trade and domestic demand Easing financial conditions and fiscal stimulus in major economies should provide some offset.
Global inflation is forecast to fall to 2.6% in 2026, aided by cooling labour markets and lower energy prices, with growth picking up in 2027.
World Bank Group Chief Economist Indermit Gill noted that the global economy grows less capably with each passing year, yet it has shown surprising resilience to uncertainty. He cautioned that sustained low dynamism could strain public finances and credit markets, as the world economy expands more slowly than in the 1990s while burdened by record public and private debt.
Story by: Mercy Addai Turkson #ahotoronline.com