The International Monetary Fund just delivered its mid-year economic check-up. The fund’s updated World Economic Outlook, released July 8, projects global GDP growth at 3% for 2026, down from 3.5% in 2025 and a slight cut from its earlier 3.1% forecast.
Energy price shocks and supply chain snarls tied to the ongoing Iran conflict are dragging on the global economy. But the IMF is pointing to an unexpected counterweight: a massive wave of US-led artificial intelligence investment that’s acting as a kind of economic shock absorber.
The AI buffer effect
The US economy is projected to grow 2.3% in 2026, unchanged from earlier forecasts. That steadiness, in the middle of a conflict that has constrained shipping through the Strait of Hormuz, is notable. The IMF credits AI-driven productivity improvements and strong corporate earnings for keeping the American economy on track.
IMF economist Petya Koeva Brooks highlighted what she called the “unexpected strength of the AI cycle” in counteracting geopolitical turbulence.
