Global economic growth should be steady this year provided the current oil price shock is not prolonged, Fitch Ratings says in its March 2026 Global Economic Outlook (GEO). As Fitch states, the world economy has held up well despite a succession of geopolitical and U.S. policy shocks. World growth was 2.7 percent last year, close to its long-run average. Assuming that the recent jump in oil prices is relatively short-lived, Fitch anticipates only a slight slowdown in 2026 to 2.6 percent, revised from 2.4 percent in December’s GEO.
Surging AI-related investment, large fiscal deficits in the United States and China, and a boost to U.S. consumption from equity market gains helped offset the impact of higher U.S. tariffs last year. Fitch expects U.S. consumption to slow in 2026 as labor market weakness weighs on household income, but the U.S. fiscal deficit is widening again. The forecast is for U.S. 2026 GDP growth at 2.2 percent, revised up from 2 percent in the January forecast update, and unchanged from last year.
Fitch projects Eurozone growth at 1.3 percent, unchanged from December, and slightly below last year. Higher energy prices are a new headwind, but underlying growth trends are improving as Germany starts to recover on fiscal easing. For the eurozone stripping out Ireland (where growth has been volatile), the firm expects a 0.3pp pick-up to 1.3 percent.
China is forecast to slow to 4.3 percent from 5 percent in 2025 as consumer spending growth is weakening and export growth is expected to cool. However, Fitch anticipates a mild recovery in capex, after 2025 saw the first annual decline in investment since 1990. The firm has raised the GDP growth forecast for 2026 by 0.2pp since December.
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