Global growth shows strain

The World Bank’s latest Global Economic Prospects report says the global economy is holding up better than expected despite persistent trade frictions and policy uncertainty. Growth is forecast at 2.6% in 2026 and 2.7% in 2027, lifted mainly by stronger U.S. performance. Yet the 2020s remain on track to be the weakest decade for global growth since the 1960s, widening disparities: nearly all advanced economies now exceed pre-pandemic income levels, while one in four developing economies remains poorer than in 2019.

A surge in trade and rapid supply-chain adjustments supported 2025 activity, but these effects are set to fade. Softer demand should lower global inflation to 2.6% in 2026, with a modest pickup expected in 2027. Developing-economy growth will hover near 4%, while low-income countries may reach 5.6%, still insufficient to narrow income gaps. The Bank urges reforms to strengthen investment, productivity, and fiscal credibility.