IMF raises US 2025 GDP growth forecast from 1.8% to 1.9%

IMF raises US 2025 GDP growth forecast from 1.8% to 1.9%

The International Monetary Fund (IMF) has revised its forecast for US GDP growth in 2025, raising it from 1.8% to 1.9%. This upward revision is part of the IMF's updated World Economic Outlook, which was released on July 29, 2025 [1].

The IMF attributed the improved outlook to several factors, including stronger-than-expected purchases ahead of an August 1 increase in US tariffs and a drop in the effective US tariff rate to 17.3% from 24.4% [1]. However, the IMF warned that the global economy remains vulnerable to major risks, including potential tariff rate rebounds, geopolitical tensions, and larger fiscal deficits [1].

The IMF's revised forecast for global growth in 2025 is 3.0%, up from the April 2025 estimate of 2.8%. The 2026 growth forecast has been adjusted to 3.1% from the April estimate of 3.0% [1]. The IMF noted that the global economy is proving resilient but that uncertainty remains high, with economic activity being recorded as distortions from trade rather than underlying robustness [1].

The IMF's updated outlook also reflects a modest upward revision in Pakistan's GDP growth estimate for fiscal year 2025–26, which has been raised to 3.6% from the previous estimate of 3.5% [2]. This projection falls short of the government's target of 4.2%.

Overall, the IMF's updated forecasts indicate a cautious but somewhat optimistic outlook for the global economy in 2025 and 2026, with the US economy expected to contribute positively to this growth [1]. However, the IMF emphasized that the resilience of the global economy is tenuous and that significant risks remain [1].

References:
[1] https://www.reuters.com/business/imf-nudges-up-2025-growth-forecast-says-tariff-risks-still-dog-outlook-2025-07-29/
[2] https://profit.pakistantoday.com.pk/2025/07/29/imf-forecasts-3-6-gdp-growth-for-pakistan-below-governments-4-2-target/