The global economy, already fragile, now faces a new shock—this time from the United States. President Donald Trump’s latest tariff wave has dragged average U.S. duties to levels unseen in over a century. The trade war with China is escalating fast.
The IMF’s latest World Economic Outlook attempts to map the damage. But it does so with caution. Its central message is not a forecast—it’s a warning.
“Nobody knows what Trump will do next,” the report implies.
“And no one can say how the world will respond.”
What we do know is this: elevated uncertainty is now the clearest economic reality.
The role of government, the IMF suggests, is to reduce that uncertainty. Trump’s administration, it argues, has chosen the opposite.
The global economy had just begun to stabilise. Inflation was falling. Labour markets were improving. Growth, while lower than pre-pandemic, was returning.
But fragilities remained. Many governments are saddled with debt. Interest rates are high. The old tools—monetary and fiscal—are harder to use.
Trump’s trade war hits in that context. And it’s already reshaping forecasts.
Global growth is projected to fall to 2.8% in 2025, down from 3.3% in 2024.
Recovery to 3% is expected only by 2026.
The figures reflect policy as of April 4. But events didn’t wait.
On April 9, Trump paused new tariffs for 90 days—then raised duties on Chinese goods. On April 12, China hit back.
As of mid-April, the U.S. effective tariff rate on Chinese goods stood at 115%. China’s rate on U.S. goods hit 146%.
The average U.S. tariff on global imports: 25%, up from just 3% in January.
This is more than a numbers game. The IMF explains how tariffs hurt the imposer:
The risk isn’t just economic—it’s systemic.
Brutal decoupling between the U.S. and China
Eroding trust in the U.S.
Currency shifts, capital flight, and political instability
Pressure on emerging economies with shrinking international support
Even the threat of major conflict
The IMF, by nature, doesn’t dive into geopolitics. But the shadows are clear.
Could the world step back from the edge?
But the report closes with realism, not hope.
We are not yet off the path to crisis. The question is whether we will choose to leave it.
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The death toll from Typhoon Kalmaegi that hit the central Philippines on Tuesday has risen to 39 on the island of Cebu, a local government official said.
Voters in New Jersey and Virginia will choose their next governors on Tuesday in two crucial races that will serve as an early indicator of how the American electorate is responding to President Donald Trump's unprecedented nine months in office.
Russia said on Monday that its troops had advanced in the eastern Ukrainian city of Pokrovsk, a transport and logistics hub that they have been trying to capture for over a year, but Ukraine said its forces were holding on.
At least 37 people have died and five are missing after devastating floods and landslides hit central Vietnam, officials said Monday, as a new typhoon threatens to worsen the disaster.
U.S. President Donald Trump said he does not believe the United States is going to war with Venezuela despite growing tensions, though he suggested President Nicolás Maduro’s time in power may be nearing its end.
A powerful earthquake measuring 6.3 struck near the northern Afghan city of Mazar-e Sharif early on Monday, leaving at least 20 people dead, hundreds injured, and causing significant damage to the city’s famed Blue Mosque, authorities said, warning that the death toll was expected to rise.
Tanzania's President Samia Suluhu Hassan vowed on Monday to move on from deadly protests set off by last week's disputed election as she was sworn into office for her first elected term.
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Microsoft has agreed a $9.7 billion partnership with data centre operator IREN, granting it access to Nvidia’s latest chips in a move designed to ease the computing bottleneck that has hampered the company’s ability to fully capitalise on the artificial intelligence boom.
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