IMF sees global economy resilient despite Iran war energy shock

**IMF Says Global Economy Has Withstood Iran‑Related Energy Shock, but Fiscal Pressures Remain**

*Washington, D.C., 27 August 2026* – International Monetary Fund (IMF) Managing Director Kristalina Georgieva told reporters on 25 August that the world economy has proven more resilient than initially feared in the face of the energy shock caused by the ongoing conflict in Iran.

Speaking ahead of the Group of Twenty (G20) finance ministers’ meeting scheduled for next week in Asheville, North Carolina, Georgieva described the current environment as a “tug of war” between the negative effects of the Gulf energy supply disruption and growth‑supporting forces such as the expanding artificial‑intelligence (AI) investment boom, which is spreading beyond the United States.

Key points from her remarks include:

– **Balanced but Down‑side‑Weighted Outlook** – While the IMF’s assessment of global risks has become more balanced compared with its April outlook, the agency still views the outlook as tilted to the downside because of rising fiscal pressures and the possibility that central banks may maintain tight monetary policies to curb inflation.

– **Fiscal Concerns** – Georgieva highlighted deteriorating fiscal conditions in several countries, noting rising sovereign bond yields and a slowdown in the disinflation process.

– **Energy Shock Mitigation** – According to the IMF chief, the global economy has “weathered the energy shock caused by the closure of the Strait of Hormuz better than we feared.” She attributed this resilience to a combination of factors, including:
* Drawing down of existing oil and gas reserves,
* Increases in non‑Gulf energy supplies,
* Reduced energy demand,
* Expansion of renewable‑energy capacity,
* A temporary shift back to coal generation in some regions.

– **AI‑Driven Growth** – Georgieva said that AI investment in the United States is helping sustain corporate earnings and consumer spending. She added that other countries are also expanding data‑center construction and the supply of AI hardware, which she sees as a positive growth tailwind.

The IMF’s comments come as policymakers prepare for the upcoming G20 finance leaders’ summit, where discussions are expected to focus on how to address lingering fiscal challenges and persistent inflation while supporting continued economic growth.

Article and image source: iranherald.com