Latest Finance-Economy News
UN warns of “resilient but subdued” global growth outlook for 2026
The UN’s *World Economic Situation and Prospects 2026* projects **global growth of 2.7%**, below both 2025 and the pre‑pandemic average, as subdued investment and structural headwinds weigh on momentum. Inflation is easing and monetary policy is loosening in many economies, but trade tensions, high public debt and geopolitical uncertainty continue to cloud the outlook, particularly for developing countries.
Easing inflation and monetary loosening support but do not fully restore global demand
Global headline inflation is forecast by the UN to decline to **3.1% in 2026** from 3.4% in 2025, helped by lower energy prices and cooling demand. Nonetheless, elevated food, energy and housing costs continue to squeeze real incomes, especially for low‑income households, limiting consumption growth and slowing progress on poverty reduction.
United States: modest 2026 growth as Fed enters later stage of easing cycle
UN projections put **US GDP growth at about 2.0% in 2026**, slightly above 2025, supported by monetary and fiscal easing even as the labour market softens. Private‑sector analyses suggest underlying US growth near 2% as AI‑related investment and high‑income consumption offset weaker trade, housing and lower‑income spending, with expectations of limited additional Fed rate cuts.
Euro area faces slower expansion amid tariffs, geopolitical risks and tight fiscal space
The UN expects **EU growth around 1.3% in 2026**, down from 1.5% in 2025, as higher US tariffs and geopolitical uncertainty weaken exports. The ECB has signalled conviction about holding policy rates near 2% this year after upgrading growth and inflation forecasts, leaving the bloc reliant on structural reforms and targeted fiscal measures rather than broad stimulus.
China’s growth slows but remains above global average on policy support
Analysts forecast **China’s real GDP growth near 4.8–5% in 2026**, driven by front‑loaded fiscal support, renewed consumption incentives and property‑stabilisation measures. Despite recent broad‑based slowing, stronger‑than‑expected manufacturing PMIs and domestic policy efforts to boost incomes and social safety nets underpin expectations of a moderate rebound.
South Asia and Africa remain global growth leaders but face debt and climate risks
The UN projects **South Asia to grow 5.6% in 2026**, led by India’s 6.6% expansion on resilient consumption and large public investment. Africa’s output is expected to rise about 4.0%, but high debt burdens, tight financing conditions and climate‑related shocks pose significant downside risks to both growth and development goals.
Gulf economies see stronger 2026 growth on higher oil output and diversification
The UN expects **GCC growth to accelerate from 3.9% to 4.5%** as increased oil production and easing inflation support headline expansion. Continued investment in tourism and technology is boosting non‑oil activity and strengthening resilience to oil‑price volatility, though regional geopolitical risks remain elevated.
Global trade growth set to slow as tariff and policy uncertainty persist
After a stronger‑than‑expected **3.8% expansion in global trade in 2025**, the UN projects growth will slow to 2.2% in 2026 as front‑loaded shipments fade and tariff impacts bite. Ongoing instability in trade policy and new tariff negotiations are creating uncertainty for multiple industries and discouraging long‑term investment.
US Supreme Court tariff ruling poised to reshape global trade and markets
The US Supreme Court is expected to rule imminently on the scope of presidential tariff authority, a decision that could force unprecedented refunds of emergency tariffs and curb unilateral trade actions. Legal clarity on this issue will have major implications for global supply chains, corporate planning and financial markets, given current high US‑China tariffs and associated sectoral deals.
Oil markets roiled by arrest of Venezuela’s president and OPEC supply moves
The US arrest of Venezuelan President Nicolás Maduro at the start of 2026 triggered concerns over Venezuelan supply and short‑term **upside risks to oil prices**. At the same time, OPEC’s phased unwinding of earlier voluntary production cuts, while keeping output unchanged for now, is adding uncertainty to the medium‑term balance for oil exporters and importers alike.
AI investment boom creates pockets of strength but widens global inequalities
Rapid advances in artificial intelligence are driving strong capital spending in some large markets and lifting productivity and growth prospects. However, the UN warns that the benefits are likely to be **unevenly distributed**, risking wider structural inequalities within and between countries if complementary policies on skills, inclusion and financing are not implemented.