IMF cuts global growth forecast, cites Trump’s tariffs

The International Monetary Fund on Tuesday cut its global growth forecasts citing the impact of the tariffs imposed by the United States earlier this month.

The swift escalation of trade tensions and extremely high levels of policy uncertainty are expected to have a significant impact on global economic activity, it said in a report on Tuesday.

The United Nations’ financial agency slashed its global growth forecast by 0.5 percentage point to 2.8% for 2025. It cut its January forecast for 2026 by 0.3 percentage point to 3%.

The International Monetary Fund said that inflation was expected to fall slower than expected in January because of the tariffs. The inflation rate would be 4.3% in 2025 and 3.6% in 2026.

It said that India would grow at 6.2% in the financial year 2025-’26. This is 0.3 percentage points lower than what the agency had forecast in January. It forecast India to grow at 6.3% in the next financial year, down from 6.5%.

Washington had announced so-called reciprocal tariffs on dozens of countries, including a 26% “discounted” levy on India, on April 2.

Trump had repeatedly said he intended to impose a reciprocal tax on India, among others, citing high tariffs the countries impose on foreign goods. He had already imposed tariffs on a range of products from Canada, Mexico and China.

On April 9, Trump...

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