The International Monetary Fund (IMF) updated its global growth forecast on October 13, 2026, in Bangkok. The IMF raised its prediction for 2026 global economic growth to 3.1%, up from 3% previously, attributing this resilience to advanced economies’ investment in artificial intelligence. However, the report warns that low-income countries face significant challenges due to high energy prices resulting from the ongoing war between the United States and Iran. The IMF’s chief economist, Silvana Tenreyro, highlighted a "bifurcated outlook" with stark differences between economies benefiting from AI advancements and those struggling with energy shocks.
Written locally by qwen2.5:14b on 2026-10-13,
using this article's own text rather than the other coverage of the
same event (that is the story summary below).
Story summary
Finance officials from around the world are gathering in Bangkok for the annual meetings of the International Monetary Fund (IMF) and World Bank, with 18,000 attendees registered, up by 4,000 since the last off-site meeting in Morocco. The events come amid the ongoing US-Israel war on Iran, now entering its eighth month, which has caused significant inflationary pressures globally. IMF Managing Director Kristalina Georgieva noted that rising interest rates, coupled with a severe energy supply shock due to the conflict, pose major risks to global economic growth, currently forecasted at 3.1% for 2026, up slightly from July's projection but still sluggish. The war has exacerbated high energy prices and debt issues in low-income countries, while advanced economies have benefited from increased investment in artificial intelligence (AI). IMF Deputy Director of Research Petya Koeva Brooks stressed that developing nations must cut spending or risk severe fiscal crises due to the compounded effects of debt and inflation, urging them to implement targeted subsidies amidst these challenges.
Written for “IMF Economic Forecasts And Policy Advice” on 2026-10-13,
grounded in this article and the 3 other(s) covering the same event.
he International Monetary Fund on Tuesday (October 13, 2026) forecast global growth in 2026 would slow less than previously expected because of advanced economies’ “resilience” in the face of war-fuelled energy prices, but warned low-income countries remained vulnerable to the supply shock.
asserted
countries → forecast → shock
In its World Economic Outlook (WEO) released at the organization’s Annual Meetings in Bangkok, the IMF raised its 2026 global growth forecast by 0.1 percentage points to 3.1%, compared with 3.5% growth in 2025.
asserted
IMF → release → 2025
It warned that while many advanced economies have been buoyed by rising investment in artificial intelligence (AI) technology, poorer countries that are not benefiting from that boom face stark choices as they deal with high energy prices caused by the Iran war.
“The global economy has been resilient, but that resilience is under strain, with risks tilted to the downside,” Silvana Tenreyro, the IMF’s chief economist, told journalists in Bangkok.
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Tenreyro → warn → Bangkok
With global debt-to-GDP ratios at sky-high levels, including in advanced economies, the IMF has called on governments to cut spending and manage borrowing — a difficult task for those in the developing world struggling with the Iran war shock.
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IMF → include → shock
“What we are advocating for is for policymakers to balance the near-term needs of inflation, and that involves food security, that involves energy security... while also keeping in mind the medium-term stability,” said Deniz Igan, chief of the IMF’s World Economic Studies division.
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Igan → advocate → division
The United States’ war on Iran, launched in February, has plunged the Middle East into violence and seen global energy prices skyrocket as a result of Tehran’s retaliation.
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prices → launch → retaliation
Prices of refined petroleum products remain between 70 and 95 percent above pre-war levels, putting pressure on countries dependent on energy imports for economic activity.
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Prices → remain → activity
On Monday night, blasts resounded across Saudi Arabia’s capital as the war’s impact widens into that country, with Iran-backed Yemeni Houthi forces hitting oil facilities, tankers and transport hubs.
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forces → resound → facilities
“A more prolonged disruption of production and transport in the Middle East could lead to” higher inflation and a drag on growth, said Tenreyro.
uncertain
Tenreyro → lead → growth
Energy-importing countries not exposed to the AI boom remain the most vulnerable, creating what the IMF termed a “bifurcated outlook” in its WEO report.
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IMF → import → report
The report detailed that the twin economic forces of the war in Iran and the AI technology boom had created a “fragmented” world economy.
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forces → detail → economy
“Headwinds from a prolonged war and persistent geopolitical tensions could revive inflationary pressures, strain fiscal and external positions, and hit energy-importing and low-income countries hardest,” it said.
uncertain
it → prolong → countries
“At the same time, the current technology tailwind could stop abruptly if expectations about AI-related profits and productivity gains are reassessed, weakening investment and tightening financial conditions.”
Responding to AFP, Tenreyro said AI had been a major factor driving the world economy, accounting for almost half of the increase in global trade from 2023 to 2025.
uncertain
AI → stop → 2025
The Middle East and Central Asia region -- exposed directly to the Iran war as Tehran targets Washington’s Gulf allies and the Houthi offensive against Saudi Arabia has picked up -- is expected to suffer a 0.3 percent contraction in 2026.
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offensive → expose → 2026
Saudi Arabia’s is one of the worst affected, with its economy projected to shrink 3.3 percent -- representing a 5.0 percentage points cut in the Fund’s forecast.
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economy → affect → forecast
The IMF said the region is expected to bounce back quickly once the war is over, but there remains high uncertainty as to when that will be.
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that → say → ?
In advanced economies, growth fuelled by the AI boom and other factors remained strong.
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growth → fuel → boom
The world’s advanced economies were forecast to grow 2.1 percent in 2026, with those in the AI supply chain such as Taiwan and South Korea posting significantly higher figures.
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those → forecast → figures
Growth in China, the world’s second-largest economy, was expected to slow, the IMF said, mainly because of weak domestic demand.
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IMF → expect → demand
Global inflation remained set to accelerate to 4.7 percent in 2026, with effects spread across advanced and developing economies.
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effects → set → economies
Call for action
Tenreyro warned that urgent action was required by all countries in the face of downside risks, and called on governments to only use temporary, targeted measures to help ease the burden on the public of high energy and other costs.
In lockstep, “monetary policy should remain firmly focused on price stability”, she added, indicating that interest rate hikes to curb high inflation were appropriate.
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hikes → warn → inflation
“The economy has been resilient, but that resilience is reaching its limits,” she said.
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she → reach → limits
“The task ahead is to move from coping to rebuilding, restoring fiscal space and supply-side resilience.”
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task → move → space
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