Economics

The war on Iran has “abruptly darkened” the global economic outlook, and if it continues could trigger a worldwide recession, the International Monetary Fund (IMF) has warned.

In its latest World Economic Outlook, a half-yearly update, the IMF downgraded most of its growth forecasts made three months earlier.

It said that if the war is short-lived, global growth would be 3.1 percent this year. That is lower than the 3.4 percent that had been predicted for 2026 before the US and Israel attacked Iran in late February, sparking weeks of war.

The IMF said the global economy had gathered momentum, partly driven by a tech boom, only to be stopped in its tracks.

“The global outlook has abruptly darkened following the outbreak of war,” said Pierre-Olivier Gourinchas, the IMF’s chief economist.