The Managing Director of the International Monetary Fund, Kristalina Georgieva, stated that the rising trade tensions and fundamental shifts in the global trading system will lead to a reduction in the IMF’s economic forecasts, but a global recession is unlikely.
Georgieva added on Thursday, ahead of next week’s spring meetings of the IMF and the World Bank, that economies are facing tough tests as the global trading system has been reshaped over the past months due to U.S. tariffs and the responses from China and the European Union.
According to Georgieva, this has resulted in “unprecedented” uncertainty in trade policy and severe fluctuations in financial markets.
She noted that “disruptions come with costs. Our new growth forecasts will include significant downward revisions, but not a recession,” adding that the estimates will take into account the potential for rising inflation in some countries.
Georgieva explained that increased uncertainty has heightened the risks of pressure on financial markets, stating that “everyone will suffer if financial conditions deteriorate.”
In January, the IMF had projected global economic growth of 3.3% in 2025 and 3.3% in 2026. The IMF will release its updated estimates next Tuesday.
