2026 Economic Outlook: Moderate Growth - Morgan Stanley
Inflation slows and moderate growth continues in 2026, according to Morgan Stanley’s economic outlook, as AI outlays provide a capital spending boost.
www.morganstanley.comHere’s a concise update on the latest global economic outlook for 2026.
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IMF projection update: The IMF’s World Economic Outlook updates in early 2026 raised the 2026 global growth forecast to about 3.3% in January, with advanced economies around 1.8% and emerging markets near 4.2% in that first update . However, by April 2026, the IMF trimmed expectations to about 3.1% global growth for 2026, citing geopolitical risks (notably Middle East tensions), trade headwinds, and financial market volatility, before a modest recovery in 2027 .
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Key regional views: The US is expected to grow around the low-to-mid 2% range in 2026, supported by domestic demand and policy measures, though trade frictions and tariffs remain a factor . The euro area faces a subdued growth path (roughly around 1% or less in 2026, depending on energy prices and industrial activity) as it contends with energy costs and structural adjustments . China’s 2026 growth is forecast to be in the 4.0–4.5% vicinity, aided by policy stimulus but constrained by housing and productivity headwinds .
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Risks and drivers: AI and data-center investment support a positive growth impulse, helping productivity and asset wealth in some regions, while geopolitical tensions, tariff policies, and financial market volatility pose downside risks . The balance of policy support (fiscal and monetary) versus supply-side shocks will shape the trajectory into 2026 and beyond .
If you’d like, I can pull the most up-to-date IMF numbers and summarize the 2026-2027 path with a simple chart. I can also tailor a regional snapshot for the markets you care about (US, EU, China, or Emerging markets).