The International Monetary Fund on Tuesday lifted its outlook for global growth this year, flagging a milder-than-expected economic hit from President Donald Trump's tariff policies while warning of risks ahead.

In its flagship World Economic Outlook (WEO) report -- compiled before the most recent US-China tariff spat -- the IMF hiked its 2025 global growth forecast to 3.2 percent, up from 3.0 in July, while leaving its prediction for 2026 unchanged at 3.1 percent.

The global inflation rate is expected to remain elevated at 4.2 percent this year, and 3.7 percent in 2026, underpinned by elevated inflation in several countries including the United States.

"The tariff shock itself is smaller than initially feared," IMF chief economist Pierre-Olivier Gourinchas told reporters in Washington

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