The International Monetary Fund (IMF) has released its latest World Economic Outlook report, warning of global economic risks and revising down the growth forecast of China’s Gross Domestic Product (GDP) to 4.5%. It is projected that China’s economic growth rate in 2027 will further slow down.
In the updated World Economic Outlook report released on October 13th, the IMF lowered its forecast for China’s GDP growth rate in 2026 to 4.5%, down by 0.1 percentage points from the forecast of 4.6% in the report issued in July of this year. The reasons for the downgrade are attributed to rising oil prices and sluggish consumption in China. The IMF’s prediction for China’s economic growth rate this year is lower than the official target set by the Chinese government.
The report highlights that as China’s real estate market continues to be sluggish, the country’s export performance can only partially offset the negative impacts of weak domestic consumption and declining investment momentum.
The IMF expects China’s economic growth rate in 2027 to further decelerate. The July World Economic Outlook report forecasted a 4.1% growth rate for China in 2027; the latest report has revised down the forecast to 4%.
Currently, China’s economy is on a downward trend, with soft consumer demand, slowing investment, and export enterprises facing immense pressure. In an interview with a foreign trade enterprise by Dajiyuan, Chen Fang, a representative of an export enterprise in China, stated that all three driving forces of China’s economic growth (investment, consumption, and export) have been affected by the economic downturn. Furthermore, the appreciation of the yuan has eroded corporate profits.
Xu Guang, a manager of a medium-sized foreign trade enterprise in the coastal region, mentioned that since the US imposed tariffs in 2025 and the EU began levying parcel taxes in 2026, the export volume of Chinese goods has significantly declined.
Zhao Pu, a major export enterprise owner, expressed skepticism about the sustained growth in official export numbers, stating that, “The piles of empty shipping containers are as high as mountains, so how can exports be showing growth? Where is this growth coming from?”
Regarding the global economic growth rate, the IMF report predicts 3.1% in 2026 and 3.4% in 2027. At the same time, the IMF forecasts that the global overall inflation rate will rise to 4.7% in 2026, and then decrease to 4.1% in 2027. The IMF believes that the rise in inflation is primarily driven by energy and food prices.
The IMF points out that the interaction between geopolitical and technological factors is causing a divergence in the global economy: favorable trade conditions or tech-related exports and investments provide buffers for some countries while others face higher import bills and softer demand.
The IMF states that there are downside risks to the global economy. Prolonged or escalated Middle East conflicts could lead to continued increases and volatility in energy and food prices, rekindling inflation pressures and worsening fiscal and external balances, thereby affecting economic growth. Additionally, further destruction of energy infrastructure, cyber attacks, or extreme weather events may amplify these impacts. Supply disruptions leading to price hikes have a greater and longer-lasting impact on the macro economy than geopolitical risks, and a significant reassessment of profitability and productivity prospects related to Artificial Intelligence (AI) could dramatically reduce investments, trigger stock market corrections, tighten financial conditions, and generate spillover effects on economies integrated into tech supply chains. Moreover, fiscal vulnerabilities and new trade tensions may further weaken growth.
The IMF forecasts the growth rate of the United States to be 2.3% in 2026 and 2027, with a 0.2 percentage point upward revision for 2027. The IMF attributes the economic activity to strong private consumption, fiscal policies, accommodative financial conditions, ongoing tech-related business investment, and productivity strength.
For the Eurozone, the IMF predicts growth rates of 1.1% and 1.2% for 2026 and 2027 respectively.