The IMF Records Unprecedented Level of Uncertainty in Trade Policy

The International Monetary Fund has downgraded its global economic growth forecast for 2025. In its April “World Economic Outlook” report, the forecasted global GDP growth will be 2.8 %, which is by 0.5 % lower than the previous forecast in January 2025.

According to the IMF, the level of uncertainty in trade policy is unprecedented. Protectionist measures in different countries have exacerbated the negative dynamics. Many countries have seen a slowdown in hiring and an increase in layoffs. Inflation in the service sector is still above pre-crisis levels, and commodity prices are rising again after a temporary decline in 2024.

Against this background, the IMF has lowered its forecast for global trade growth: in 2025, it is expected to grow by only 1.7 % (compared to 3.2 % in the previous forecast), and in 2026 – by 2.5 % (compared to 3.3 %).

In 2025, the average oil price is expected to decline by 15.5 % to USD 66.94 a barrel. In 2026, the price of oil will decrease by an additional 6.8 % to USD 62.38 a barrel.

The global inflation forecast for 2025 has been raised to 4.3 % (+0.1 %), and for 2026 – to 3.6 %. At the same time, inflation is expected to reach 2.5 % in 2025 (+0.4 %) in advanced economies. In developing countries, the forecast for 2025 has been lowered to 5.5 %.

The global economy is facing serious challenges amid changes in the trade policies of leading countries, rising geopolitical tensions, and a general slowdown in economic activity. A slowdown in the growth of the world’s largest economies and a decline in global trade will first of all affect countries whose goods are export-oriented.