Trump claims America is ‘winning so much.’ The IMF agrees, adding that Trump’s trade policies are the only thing holding it back from even more

Fortune

by Tristan Bove

February 26, 2026

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The U.S. economy remains a global powerhouse, with strong growth, rising productivity, and a resilient labor market, according to the International Monetary Fund (IMF). Despite President Donald Trump’s claim that the U.S. is “winning so much” economically, the IMF highlights a significant challenge: Trump’s trade policies, particularly his use of tariffs, are creating obstacles for achieving fiscal balance. While the U.S. private sector has shown remarkable performance, the administration’s focus on punitive tariffs may be counterproductive, as they reduce potential economic growth and productivity gains. The IMF predicts that the U.S. economy will continue to grow strongly in 2023 and beyond, with GDP growth projected at 2.4% for this year. However, the agency warns of a troubling paradox: while tax cuts and spending changes from Trump’s policies are boosting short-term economic activity, they are also contributing to rising federal debt. Under current policies, general government debt could reach 140% of GDP within five years, potentially exceeding $50 trillion. This growing fiscal imbalance threatens to overshadow the benefits of a strong economy. The IMF’s managing director, Kristalina Georgieva, emphasized that while the U.S. is in a position to fund its spending and create positive global spillovers, it must address its deficit and debt levels to sustain long-term prosperity. She cautioned against relying on short-term economic boosts, such as those from tax cuts, which could lead to a sugar-high effect—followed by a widening deficit and higher interest payments. Groups like the nonpartisan Committee for a Responsible Federal Budget have also raised concerns, warning that the current trajectory risks overwhelming the government’s ability to manage spending. For businesses, this situation matters because the U.S. economy’s strength and stability are closely tied to global economic conditions. While Trump’s trade policies aim to bring in revenue and reduce the deficit, they may ultimately hinder productivity and growth, creating a drag on both domestic and international markets. The IMF’s recommendations suggest that balancing budget priorities with trade policy decisions will be crucial for maintaining the U.S.’s economic dominance and ensuring sustainable prosperity.

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Originally published on Fortune on 2/26/2026