Atradius Sees Global Growth Stabilizing Amid Fragile Strait Truce

Global GDP growth is projected to slow to 2.4% in 2026, down from the 3.0% recorded in 2025, before a potential recovery to 3.1% the following year. While energy costs spiked during the height of the Strait of Hormuz disruptions, the current easing of tensions has allowed central banks to navigate the volatility with varying strategies. John Lorié, chief economist at Atradius, noted that the ongoing investment boom in artificial intelligence and semiconductor manufacturing is acting as a critical buffer, shielding advanced economies from the full force of the energy shock.

Central bank responses remain fractured. The European Central Bank has opted for rate hikes to combat inflation, whereas the US Federal Reserve maintains a higher-for-longer stance. China, conversely, is leaning into a looser monetary policy to stimulate domestic demand. Despite these efforts, trade momentum is set to soften, with growth expected to languish below 2% this year due to persistent policy uncertainty and elevated commodity costs.

Downside risks remain substantial. Should the conflict resume and lead to a prolonged closure of the Strait of Hormuz through the fourth quarter, Atradius warns that global GDP could slip to 1.9% in 2026 and 1.4% in 2027. Under this scenario, the combination of surging energy prices and renewed inflationary pressure would likely push major advanced economies into a formal recession.