The International Monetary Fund cut its global growth forecast for this year and warned of increasing risks to global financial stability, citing the effect of US President Donald Trump's policies on the world economy, AFP reported.

According to the IMF's projections, which include some but not all tariffs introduced this year, the global economy will grow by 2.8 percent in 2025, 0.5 percentage points less than the previous World Economic Outlook (WEO) forecast in January.

World growth is then projected to reach 3.0% next year, down 0.3 percentage points from January.

"We are entering a new era as the global economic system that has functioned for the past 80 years is realigning," IMF chief economist Pierre-Olivier Gourinchas said.

"If sustained, rising trade tensions and uncertainty will slow global growth," he added, noting that recent announcements on U.S. tariffs have more than doubled the Fund's forecast for global trade growth this year.

The WEO was released as the world's financial leaders gathered in Washington for the World Bank and IMF spring meetings, which are hosted by the two international financial institutions at their headquarters within arm's reach of the White House.

Given the lingering nature of Trump's tariffs, the IMF introduced an April 4 cutoff date, meaning they do not include the administration's latest salvos that raised the level of new levies against China to 145 percent.

If these policies are taken into account and persist, it could significantly slow global growth, the IMF believes.

In a separate report, also released on April 23, the Fund warned that Trump's introduction of stop-start tariffs has also led to increased risks to financial stability.

"Risks to global financial stability have increased substantially due to tighter global financial conditions and heightened economic uncertainty," the IMF said in its latest Global Financial Stability Report. | BGNES