IMF HQ in Washington. Official Website.
Egypt is currently implementing an $8 billion Extended Fund Facility (EFF) loan programme with the IMF, which is scheduled to conclude in November.
The two sides have reached a staff-level agreement on the fifth and sixth programme reviews, both of which are expected to be completed in the first quarter of 2026.
According to the report, growth in the Middle East and North Africa is expected to gather pace over the next two years as the global economy maintains steady momentum despite rising uncertainties.
The report also raised the global growth forecast to 3.3 percent in 2026, up from 3.1 percent, and 3.2 percent in 2027, broadly in line with the estimated 3.3 percent recorded in 2025. This reflects what the IMF described as a resilient expansion shaped by the balancing of divergent forces.
In the Middle East and Central Asia, growth is forecast to rise from 3.7 percent in 2025 to 3.9 percent in 2026 and 4.0 percent in 2027, supported by higher oil output, resilient domestic demand, and ongoing reform programmes, the report indicated.
Global outlook: Steady but fragile
The IMF said global growth continues to be underpinned by strong investment in technology, particularly artificial intelligence, accommodative financial conditions, and fiscal support in several major economies.
However, trade policy uncertainty and geopolitical risks remain key headwinds.
The headline inflation is expected to decline from 4.1 percent in 2025 to 3.8 percent in 2026 and 3.4 percent in 2027, returning to target more gradually in the United States than in other advanced economies, according to the report.
World trade volume growth is forecast to slow from 4.1 percent in 2025 to 2.6 percent in 2026 before recovering to 3.1 percent in 2027, reflecting shifts in trade policies and supply chains, the report noted.
Diverging regional performance
Growth in advanced economies is projected at 1.8 percent in 2026 and 1.7 percent in 2027. The US economy is expected to expand by 2.4 percent in 2026, supported by fiscal stimulus and lower interest rates, while euro area growth is forecast to remain modest at around 1.3–1.4 percent.
Among emerging markets, China’s growth is projected at 4.5 percent in 2026 before easing to 4.0 percent in 2027. India’s growth is forecast at 6.4 percent in both 2026 and 2027.
Downside risks persist
The IMF warned that risks to the outlook remain tilted to the downside, citing the possibility of a sharp correction in technology and AI-related investments, renewed trade tensions, escalating geopolitical conflicts, particularly in the Middle East and Ukraine, and rising public debt burdens.
However, faster adoption of artificial intelligence could increase global growth by up to 0.3 percentage points in 2026, with further gains over the medium term if productivity improves, the report said.
Policy priorities
The WEO urged governments to rebuild fiscal buffers, preserve price stability, reduce policy uncertainty, and accelerate structural reforms to support sustainable growth.
It also stressed the importance of central bank independence, disciplined fiscal management, and clear trade policy frameworks to stabilize expectations and broaden the sources of global growth.
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