Chief Economists Outlook September 2025

The International Monetary Fund (IMF) now projects 3% global GDP (gross domestic product) growth in 2025, a modest upward revision from April’s 2.8% forecast, but still well below the 2000-2019 average of 3.7%.1 Even this limited expansion is notable against the backdrop of extraordinary disruption: the greatest dislocation in global trade in recent memory;2 conflicts in Ukraine,3 the Middle East4 and South Asia;5 record-breaking climate events;6 and an ongoing reconfiguration of global economic and geopolitical power.7 As explored in chapter 2, all major parts of the global economy are undergoing disruptions that the chief economists view as significant and long-lasting. Geoeconomic fragmentation is accelerating. Of respondents surveyed, 82% expect this to intensify in the year ahead, with trade tensions at the heart of this shift.8 The US has imposed sweeping tariffs on a wide range of its trading partners9 and introduced new export taxes on domestic chipmakers.10 These measures have not reduced global trade; in fact, trade volumes increased by $300 billion in the first half of this year,11 driven by frontloading of shipments ahead of expected tariff changes.12 Supply chains are realigning with Chinese exporters increasingly redirecting shipments away from the US,13 even as the US extended a 90-day tariff truce14 in the context of Chinese pressure on access to strategic resources.15 Global investors are recalibrating their positions in response to US policy shifts. The US dollar depreciated by more than 10% since January, the steepest decline since 1973.16 Seventy- eight percent of the chief economists surveyed expect the dollar to weaken further in the year ahead. While this gives emerging and developing economies greater monetary policy flexibility, it also amplifies the domestic impact of tariffs in the US by further raising the cost of imports.17 The rapid pace of AI development and adoption adds another layer of uncertainty. Sixty-eight percent of respondents now expect AI to become commercially disruptive within the next year, up sharply from 45% in April. The technology’s productivity impact might take longer to materialize. There is widespread hope that AI may unleash faster productivity growth, but only 40% of chief economists expect productivity to increase in the year ahead. Although recent OECD (Organisation for Economic Cooperation and Development) estimates suggest that AI could raise labour productivity growth in the G7 by 0.2-1.3 percentage points annually over the next 10 years,18 chief economists are split on the question of AI-induced labour market disruption. Figure 2 : Global context Looking to the year ahead, do you agree/disagree with the following statements? Geoeconomic fragmentation will intensify The dollar will weaken against other major currencies AI will be commercially disruptive Productivity growth will increase AI will significantly disrupt labour marketsStrongly disagree Disagree Neither agree nor disagree Agree Strongly agree 51 31 11 6 11 26 34 23 31 6 634 34 620 57 116 17 69 9 Share of respondents (%) Source: Chief Economists Survey. (August 2025). Chief Economists’ Outlook September 6