Economic outlook 2026-27: Stretching the limits 

Executive Summary

• Global GDP growth remains strong... for now. It is expected to reach +2.9% in 2026 and +2.8% in 2027, following a robust +3% in 2025. Carryover growth from a strong 2025 in the US and China, as well as sustained momentum in the face of disruptions, account for over two-thirds of the upward revision compared to last quarter.
• The US economy is increasingly running on two speeds. The impact of the trade war has been milder, at just -0.6pp in 2025 vs -1.6pp estimated in Q2. This improvement is due to reduced tariffs (to 11% effective from 27% announced on 2 April) through sector exclusions and strategic trade deals with key partners.
  
• China’s export growth remains the front-runner – despite the trade war! Growth has exceeded expectations, buoyed by stronger-than-anticipated external demand (and soft imports). This surge was driven by frontloading from the US in the first half of the year, strategic rerouting to circumvent tariffs, expanding market shares in the rest of the world, a weaker currency and competitive prices.