"The International Monetary Fund has warned mounting geopolitical tensions and an escalation of Donald Trump's tariff war could hit global economic growth and trigger a backlash in financial markets. In an update as Trump threatens to impose tariffs on Nato allies opposed to his ambitions in Greenland, the Washington-based fund said a renewed eruption in trade tensions was among the biggest risks to global growth in 2026."
"As world leaders prepare to gather in Davos, Switzerland, for the annual World Economic Forum meeting widely seen as a critical moment to salvage international cooperation the IMF said a breakdown in relations between the world's most powerful nations would have damaging consequences. Setting out the risks to its World Economic Outlook (WEO) report, it said renewed trade tensions could blow its forecasts off course by prolonging uncertainty and weighing more heavily on activity."
The International Monetary Fund warned that mounting geopolitical tensions and an escalation of US tariffs could hit global economic growth and trigger market backlash. Threats to impose tariffs on Nato allies over Greenland ambitions heighten trade-war risks. A breakdown in relations among major powers would disrupt supply chains, markets, and commodity prices. Renewed trade tensions could prolong uncertainty and weigh more heavily on activity, blowing forecasts off course. Surging technology investment, including AI in the US and Europe, offset trade headwinds in 2025. Global growth is projected at 3.3% in 2026 and 3.2% in 2027. US growth was upgraded to 2.4% this year; UK growth forecasts remain 1.3% and 1.5%.
Read at www.theguardian.com
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