Washington, January 19 (QNA) - The International Monetary Fund (IMF) has once again revised upward its projections for global growth in 2026, amid the adaptation of companies and economies to tariff reductions in recent months, and the ongoing surge in investment in artificial intelligence, which has bolstered asset wealth and expanded productivity prospects.

In its World Economic Outlook report, IMF projected global GDP growth at 3.3 percent in 2026, an increase of 0.2 percentage points over its previous estimate in October, matching the level expected for 2025. Meanwhile, it kept its 2027 growth forecast unchanged at 3.2 percent.

The IMF noted that the improvement in growth prospects reflects trade agreements that reduced tariffs, in addition to the ability of companies to reorient supply chains and continued investment linked to artificial intelligence.

The IMF's latest projections assume an effective US tariff rate of 18.5 percent, down from roughly 25 percent in its April 2025 forecast.

It estimated that the US economy will grow by 2.4 percent in 2026, up 0.3 percentage points from the October forecast, supported by investment in artificial intelligence infrastructure, while lowering its 2027 US growth forecast by 0.1 percentage points to 2 percent, the report noted.

The Fund further highlighted that investment in technology enhances economic activity in Spain, which saw its 2026 GDP growth forecast raised by 0.3 percentage points to 2.3 percent.

In the United Kingdom, IMF maintained its growth projection at 1.3 percent for 2026.

It emphasized that artificial intelligence represents a significant opportunity for global economic growth if increased investment leads to rapid adoption of this technology, driving productivity gains and strengthening business mechanisms and innovation.

As such, global growth could rise by up to 0.3 percentage points in 2026 and between 0.1 and 0.8 percentage points annually over the medium term, depending on the pace of AI adoption and the readiness of countries and economies to capitalize on it worldwide, the report read.

Regarding other major economies, IMF projected China's growth at 4.5 percent in 2026, down from the above-expectation performance of 5 percent in 2025, but 0.3 percentage points higher than the October forecast.

The Fund also projected Eurozone growth at 1.3 percent in 2026, up 0.1 percentage points from October estimates, driven by increased public spending in Germany and improved performance in Spain and Ireland.

It left the Eurozone growth forecast for 2027 unchanged at 1.4 percent, noting that the planned European increases in defense spending will only materialize in later years.

The Fund further projected that global inflation would continue to decline from 4.1 percent in 2025 to 3.8 percent in 2026 and 3.4 percent in 2027. (QNA)