The International Monetary Fund published analysis projecting global growth to hold at 3.3% in 2026, a 0.2 percentage point upgrade from its October estimates, as the world economy absorbs the immediate impact of US-led trade disruptions. The IMF attributes the resilience to easing trade tensions, stronger-than-expected fiscal support, accommodative financial conditions, private-sector adjustments to disruptions, improved policy frameworks in emerging markets, and a surge in information technology investment, particularly in artificial intelligence. The IMF flags rising risks from the concentration of technology investment and increasing reliance on debt financing as the expansion accelerates, which could amplify shocks if returns disappoint or financial conditions tighten. It notes US IT investment as a share of output is at its highest level since 2001 and equity prices have risen sharply since late 2022; while estimated broad US equity overvaluation is about half that seen in the dot-com era, vulnerability to a tech repricing is heightened by the narrow set of AI-related stocks driving index gains, borrowing by important AI firms that are not publicly listed, and a higher US market capitalization-to-output ratio (226% now versus 132% in 2001). On the outlook, the IMF estimates AI-driven productivity upside could lift activity by 0.3% relative to baseline this year, while an October 2025 downside scenario featuring a moderate AI valuation correction and tighter financial conditions would reduce global growth by 0.4%, with spillovers potentially amplified by increased foreign ownership of US equities and limited fiscal space in many countries. On policy, the IMF calls for strong prudential oversight, including robust underwriting standards by banks and nonbanks exposed to the technology sector, adherence to internationally agreed bank capital and liquidity standards, and preparedness to deploy contingency plans. It argues monetary policy may need to tighten if the tech boom raises neutral rates, but would need to ease quickly if a downside scenario triggers a rapid demand decline, and it stresses the importance of central bank independence; fiscally, it urges renewed efforts to reduce public debt, alongside measures to manage AI-related labour market disruption through skills, mobility support and competitive markets.

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