AI a key driver

Looking forward, many research and market institutions expect the world economy to improve moderately in 2026 as countries become better adapted to the fallout from trade tensions, and hopes rise that the Ukraine conflict will end.

However, some are cautious on the outlook, citing potential challenges such as recurrent trade uncertainties, geopolitical tensions, climate change, and inflation.

Global growth is projected to decelerate from 3.3 percent in 2024 to 3.2 percent in 2025 and 3.1 percent in 2026, the IMF forecast in its report.

Consultancy EY-Parthenon forecast global growth will slow modestly in 2026, with real GDP rising 3.1 percent, compared with 3.3 percent in 2025 and 2024.

"Looking to 2026, we think … AI and innovation will stay robust," said Zhou of Oakcean Capital.

AI will continue to be the key growth driver in the US, and at the same time, slower inflation and weak jobs data are expected to kick-start an easing monetary cycle, providing a boost to the non-AI economy and consumers, she added.

The US economy will benefit from the AI innovation and investment boom in 2026. "This strong secular trend underpins the growth potential in the US," Zhou said. "The non-AI economy is struggling to grow, and consumers are facing the uncertainty of a slower job market."

Jan Hatzius, chief economist and head of Goldman Sachs Research, said in the Macro Outlook 2026:Sturdy Growth, Stagnant Jobs, Stable Prices report: "The US is expected to substantially outperform consensus estimates because of tax cuts, easier financial conditions, and a reduced drag on the economy from tariffs."