The World Bank expects global growth to slow to 2.5% in 2026, before firming in 2027-28 as energy supplies recover and trade strengthens, according to its June 2026 Global Economic Prospects report.
Energy and tariffs weigh
The report cites the Middle East conflict, which has driven sharp increases in energy prices, as a key drag. The tariff environment remains a major concern, with risks skewed to the downside — including escalating hostilities, commodity-market disruptions and geopolitical strains.
Emerging markets squeezed
Emerging market and developing economies face their weakest per-capita income growth since the pandemic. Growth in South Asia is projected to moderate to 6.2% in 2026 before picking up to 6.5% in 2027.
The Bank stressed that while the global economy has shown resilience, persistent trade-policy uncertainty and tariff tensions remain significant downside risks.
Sources: World Bank Global Economic Prospects (June 2026), Reuters.