NEW YORK -- A report of the International Monetary Fund (IMF) released Wednesday projects US real GDP growth of 2.6 percent in 2026, slightly higher than its January forecast of 2.4 percent.

In a statement describing the preliminary findings at the end of an official staff visit, IMF staff attending the 2026 Article IV Consultation found that after declining somewhat in 2025, the US federal deficit is expected to exceed 6 percent of GDP in the next few years, while the federal debt-GDP ratio is projected to steadily increase over the medium term.

The IMF found that higher tariffs represent a negative supply shock to the US economy, which is expected to raise the personal consumption expenditures price index by around 0.5 percent by early 2026, and reduce the level of output by around 0.5 percent.

Although the pass-through of tariffs to consumers could be lower than expected, uncertainty surrounding trade policies may pose a larger-than-expected drag on US economic activity.

The IMF said that the upward path of the public debt-GDP ratio, along with a rising short-term debt-GDP ratio, represents a growing stability risk for both the United States and the global economy.

It urged the United States to work constructively with its trading partners to address concerns over unfair trade practices and to agree on a coordinated reduction in trade restrictions and industrial policy distortions that have negative cross-border effects.