An economic forecast is an estimate of future economic conditions based on current trends and assumptions. It is used for a variety of purposes, including to help make business decisions. Forecasts can be made at a high level of aggregation, such as GDP and inflation, or more disaggregated, targeting specific economic sectors or individual firms. Economic forecasts are produced by national governments, central banks and other financial institutions, private firms, research institutes, and international organizations such as the IMF and OECD.
In Sub-Saharan Africa, growth is projected to moderate from 3.7 percent this year to an average of 4.2 percent in 2025 and 2026-27, reflecting a weaker external environment and domestic headwinds. A sharp rise in trade barriers and elevated policy uncertainty are expected to weigh on activity. High government debt and interest rates, consolidation driven by rising debt-servicing costs, and reduced official aid are also constraining regional development.
On the upside, surging investment in artificial intelligence (AI) and a more favorable outlook for global finance could provide a backstop to 2025 growth. However, continued exuberance is at risk of triggering tighter monetary policies, denting wealth and consumption, raising debt-servicing costs, and depressing savings and borrowing — especially in the U.S. where delinquency rates on credit cards, student loans, and auto debt continue to rise. This would stifle capital spending, dent household spending, and dampen employment gains. More frequent extreme weather events are also a potential threat to the outlook.