IMF warns of global trade war financial risks

The International Monetary Fund issues  serious warning: as trade war unleashed by the United States threatens global financial stability.

The counters of the global economic system have been reset to zero, warns Pierre-Olivier Gourinchas, chief economist at the IMF.
The immediate result: financing conditions are tightening, uncertainty is climbing, and investment is slowing down.

Global growth is revised downwards: 2.8% in 2025, and 3% in 2026.
The United States should see its activity decline by 1.8%, China fall to 4%, and Japan plateau at 0.6%.
Even Europe is not totally spared, with Germany and Italy in the red.

The backdrop: a brutal shock to supply chains, rising prices, and world trade in freefall, with trade forecast to fall by half.

Emerging markets are also worried: their currencies are soaring, but their exports are running out of steam. For the IMF, this trade war marks “a historic turning point”.

source: Le Figaro