What is the World Bank's new baseline forecast for global growth in 2026, and what key condition does it assume?

The World Bank cut its global growth forecast for 2026 to 2.5%, down 0.1 percentage point from its January estimate and the lowest since the COVID pandemic began in late 2019; this baseline assumes an average Brent crude oil price of $94 for the year — up 36% from 2025 — and that the worst energy supply disruptions will abate by the end of July, with global headline inflation projected at 4%.

What is the most severe downside scenario outlined by the World Bank, and what would trigger it?

The most severe downside scenario projects global growth slowing to just 1.3% in 2026, which would occur if the energy shock spreads to financial markets — causing lower energy prices, greater volatility, weaker confidence, and reinforcing stress between energy and financial systems — as warned by Ayhan Kose, the World Bank's deputy chief economist.

World Bank cuts global growth outlook to 2.5%, warns of drop to 1.3% if war fallout spreads to markets

Jun 11, 2026

The World Bank cut its 2026 global growth forecast to 2.5% amid Middle East war risks, warning energy disruptions could lower it to 1.3%. Rising oil and fertilizer prices threaten inflation and food supply stability.

reuters

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