Thanks to Stalled Economic Growth, a 'Lost Decade' Looms
Newser • • business
Key Points:
- The World Bank has downgraded its global growth forecast for 2026 to 2.5%, the slowest pace since the pandemic, due to the impact of the Middle East war on energy exports and prices.
- Global growth is expected to reach 2.9% in 2025, with Brent crude oil averaging $94 per barrel and global inflation around 4%.
- While two-thirds of countries face downgraded forecasts, the US economy remains stable with a projected growth rate of 2.2%, unchanged since January.
- More severe scenarios predict global growth could fall to 2.1% or even 1.3% if the energy crisis persists or market stress worsens, disproportionately affecting developing economies.
- India is a notable exception with a forecasted GDP growth of 6.6%, whereas the Middle East's growth outlook has dropped to 1.6%, highlighting regional disparities.