""The global outlook has abruptly darkened following the outbreak of war in the Middle East," Pierre-Olivier Gourinchas, chief economist of the IMF, said in the report. "The war interrupted what had been a steady growth trajectory.""
""Under a 'severe scenario,' the report said, where the war stretches for several months and perhaps into next year, worldwide economic output could drop to just 2 percent, a rate that is widely considered to be the equivalent of a global recession.""
The IMF report indicates that the ongoing U.S.-Israeli war on Iran has disrupted economic momentum, particularly affecting oil supply chains. The global growth rate for 2026 has been downgraded from 3.3 percent to 3.1 percent, based on the assumption that the conflict will end soon. In a severe scenario, prolonged hostilities could reduce worldwide economic output to 2 percent, signaling a potential global recession. Low-income countries reliant on energy imports would face the most significant challenges.
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