The International Monetary Fund (IMF) has warned that trade tensions and a reversal in the artificial intelligence (AI) boom pose major risks to global economic growth. The IMF’s latest World Economic Outlook calls the global economy "steady" with growth projected at 3.3% this year, slightly up from its previous forecast of 3.1%. Growth is expected to slow mildly to 3.2% in 2027. IMF chief economist Pierre Olivier Gourinchas told the BBC, "We have a picture of a global economy that is growing at - it's not outsized growth rates but it's quite resilient, quite robust." He noted the global economy has been recovering from last year's trade disruptions. The IMF credited surging investments in technology, including AI, as key growth drivers. Yet, the report warned: "Risks to the global outlook remain tilted to the downside." If AI growth expectations prove too optimistic, an abrupt market correction could hit wealth and spending. Gourinchas said rising corporate debt to fund AI investments could also increase financial vulnerabilities. Trade tensions, including those sparked by US tariffs, remain a concern. "Trade tensions could flare up, prolonging uncertainty and weighing more heavily on activity," the IMF warned. It also flagged potential shocks from domestic or geopolitical conflicts affecting markets, supply chains, and prices. The IMF expects UK growth at 1.3% this year, making it the third fastest growing G7 economy behind the US and Canada. Chancellor Rachel Reeves welcomed the upgrades but opposition critic Sir Mel Stride downplayed the gains. The report forecasts global inflation to fall from 4.1% in 2025 to 3.4% by 2027. UK inflation is expected to return to 2% by year-end as energy price effects fade. Central bank independence is "paramount for macroeconomic stability and economic growth," the IMF stressed. It warned that loss of this independence risks inflation and rising borrowing costs. Gourinchas added, "Without it, the economic environment deteriorates pretty rapidly." This statement comes as the US Federal Reserve chair faces a criminal investigation, with global central bankers voicing full support for his independent role. The IMF cautions governments against pressuring central banks to keep interest rates low for easier borrowing, as this ultimately backfires. In summary, the IMF paints a steady but cautious global economic outlook, highlighting key threats from trade issues, AI market shifts, and political pressures on central banks.