💵 Governments are borrowing like it's 2020 all over again
 
Rising borrowing costs and mounting debt could leave governments increasingly exposed to economic shocks, the IMF’s latest World Economic Outlook report warns.

Key takeaways:

♦️ Advanced economies are set for their biggest deficits since 2021, as net borrowing is projected to reach 5.2% of GDP in 2026, reflecting growing pressure on public finances

♦️ The US and China are facing particularly large deficits. Government net borrowing may reach 8.5% of GDP in the US and at least 8% in China this year

♦️ India remains a standout performer, as it is projected to grow by 7% in both 2026 and 2027

♦️ Global public debt is approaching a critical threshold, and it could climb towards 100% of world GDP by the end of this decade, leaving governments with less room to respond to future crises

♦️ AI is helping sustain global growth, but the benefits are unevenly distributed. 2027 could see global GDP growth of 3.1% in 2026 and 3.4% in 2027, while an increasing share of that growth is concentrated in a smaller number of economies

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