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Global economy to slow down in 2026, says WEF report
25 Jan 2026

The World Economic Forum (WEF) has released its latest Chief Economists' Outlook, predicting a tough year for the global economy in 2026.

The survey reveals that while confidence has improved slightly from last year, more than half of leading economists expect a downturn in global economic conditions over the coming months.

Specifically, 53% of chief economists anticipate a slowdown in the world economy, with only 19% predicting stronger growth ahead.

Factors influencing global economic outlook
Influencers

The WEF report highlights several factors shaping the global economic outlook. These include high debt levels, inflated asset prices, and persistent geopolitical tensions.

Trade disputes and changing alliances are also reshaping global investment and supply chains.

Despite these challenges, financial markets have remained resilient, particularly in the US where artificial intelligence (AI)-related stocks have seen significant growth.

Concerns over high valuations and asset bubbles
Market concerns

Despite the resilience of financial markets, economists are divided on the sustainability of these high valuations.

Some experts warn about potential asset bubbles and abrupt market corrections.

Others argue that today's top tech companies are more profitable and better capitalized than their predecessors during previous market downturns.

Meanwhile, traditional safe-haven assets like gold have gained traction as investors seek refuge from uncertainty.

Debt levels and spending priorities
Debt concerns

Debt has emerged as a major concern for governments and businesses worldwide.

Years of heavy borrowing have pushed public and private debt to unprecedented levels, forcing the policymakers to make tough choices.

The WEF report predicts an increase in spending on defense, digital infrastructure, and energy while budgets for education, social protection, and environmental programs may come under pressure.

Global trade and AI's impact on economy
Trade shifts

The WEF report also highlights a shift in global trade toward a more fragmented world.

Countries are increasingly opting for regional and bilateral trade deals to secure access to critical resources and technologies.

This could benefit certain regions while others may struggle with protectionist measures and policy uncertainty.

Artificial intelligence (AI) is seen as both an opportunity and a disruptor, with economists expecting it to boost productivity over time but not evenly distribute benefits across sectors or regions.