The "surprisingly resilient" global economy is at risk of being disrupted by a sharp reversal in the AI boom, the IMF warned on Monday, as world leaders prepared for talks in the Swiss resort of Davos. From a report: Risks to global economic expansion were "tilted to the downside," the fund said in an update to its World Economic Outlook, arguing that growth was reliant on a narrow range of drivers, notably the US technology sector and the associated equity boom. Nonetheless, it predicted US growth would strongly outpace the rest of the G7 this year, forecasting an expansion of 2.4 per cent in 2026 and 2 per cent in 2027. Tech investment had surged to its highest share of US economic output since 2001, helping drive growth, the IMF found. "There is a risk of a correction, a market correction, if expectations about AI gains in productivity and profitability are not realised," said Pierre-Olivier Gourinchas, IMF chief economist. "We're not yet at the levels of market frothiness, if you want, that we saw in the dotcom period," he added. "But nevertheless there are reasons to be somewhat concerned."

Read more of this story at Slashdot.

China's birth rate fell to 5.6 per 1,000 people in 2025, the lowest figure since the founding of the People's Republic in 1949, and the country's total population contracted by 3.39 million, the sharpest decline since the Mao Zedong era. The drop marks the fourth straight year of population decline and comes despite government efforts to encourage childbearing, including subsidies of about $500 annually per child born on or after January 1, 2025. Beijing has also imposed a 13% value-added tax on contraceptives this year. The government is betting on automation and productivity to offset the shrinking workforce -- China already leads the world in robot installations -- and President Xi Jinping has written that population policy must transition "from being mainly about regulating quantity to improving quality."

Read more of this story at Slashdot.