Global real gross domestic product growth is forecast to reach 3.1% in 2026, representing only a slight decline from the 3.2% estimated for 2025, according to projections released Tuesday by the Mastercard Economics Institute in its new Economic Outlook 2026 report.
The CEO of Mastercard
He adviced the business communiteee to “Stay close to the data. In a fragmented world, real-time insights matter more than ever“
“The overall story is one of continued, but divergent, expansion in the global economy,” said Michelle Meyer, Mastercard’s chief economist.
She explained that while 2025 dominated with major headlines around inflation concerns, new tariff policies, tax cuts, and AI advancements, 2026 will focus on the tangible results—both positive and negative—of those developments as they play out more clearly across economies worldwide. Despite lingering market uncertainty, Meyer emphasized the global economy’s resilience, supported by ongoing AI investments, interest rate reductions, and government stimulus measures that collectively underpin GDP expansion.
The report highlights three key trends shaping 2026: global trade realignment, increased spending on AI, and small businesses adapting to macroeconomic shifts. At the center of the narrative stand the world’s two largest economies, the U.S. and China, where trade tensions intensified this year following U.S. tariff increases on Chinese imports in the spring.
For China, GDP growth is projected at 4.5% in 2026, easing from 4.8% in 2025, partly due to reduced demand from the U.S. market; to counter this, China has been strengthening ties with emerging markets. In contrast, the U.S. economy is expected to accelerate to 2.2% growth from 2% this year, driven by factors such as new tax cuts that bolster research and development as well as manufacturing investments. Even with robust recent growth, U.S. consumer sentiment remains subdued since the pandemic, with ongoing worries about elevated prices and a changing jobs landscape—Meyer noted these pressures, including inflation and labor market volatility, could persist into 2026.
AI adoption and related spending are set to continue strongly into next year, accompanied by substantial government expenditures, such as China’s initiatives for smart cities and high-speed rail, alongside Germany’s expanded outlays for defense and green technologies. The U.S. and Denmark currently lead in AI enthusiasm, per the report’s new MEI AI Enthusiasm Index. However, the analysis cautions that while this spending will drive growth, it carries risks: “In some instances excessive spending could prompt an overheating of the economy, fueling inflation and undermining debt sustainability.”
Small and medium-sized businesses in the U.S. have borne a heavier tariff burden compared to larger corporations, which can more easily adjust supply chains or stockpile inventory. Heading into 2026, the Mastercard Economics Institute anticipates these smaller firms will enhance their competitiveness by reducing costs and optimizing operations through better access to technology tools—for example, 44% of new U.S. card-accepting businesses operated online-only in 2024, a sharp 20 percentage point rise from 2019, signaling a surge in digitally native enterprises.
