Market News

WASHINGTON (AP) — An unexpectedly sturdy world economy is likely to shrug off President Donald Trump's protectionist trade policies this year, thanks partly to a surge of investment in artificial intelligence in North America and Asia, the International Monetary Fund said in a report out Monday.

The 191-nation lending organization expects that global growth will come in at 3.3% this year, same as in 2025 but up from from the 3.1% it had forecast for 2026 back in October.

The world economy "continues to show notable resilience despite significant US-led trade disruptions and heightened uncertainty,'' IMF chief economist Pierre-Olivier Gourinchas and his colleague Tobias Adrian wrote in a blog post accompanying the latest update to the fund's World Economic Outlook.

The U.S. economy, benefiting from the strongest pace of technology investment since 2001, is forecast to expand 2.4% this year, an upgrade on the fund's October forecast and on expected 2025 growth — both 2.1%.

China — the world's second-largest economy — is forecast to see 4.5% growth, an improvement on the 4.2% the IMF had predicted October, partly because a trade truce with the United States has reduced American tariffs on Chinese exports.

India, which as supplanted China as the world's fastest-growing major economy, is expected to see growth decelerate from 7.3% last year (when it was juiced by an unexpectedly strong second half) to a still-healthy 6.4% in 2026.

Paul Wiseman, The Associated Press