The US economy is withstanding the impact of record protectionism better than expected, the International Monetary Fund said as it prepares its latest assessment of President Trump’s tariffs.

Kristalina Georgieva, managing director for the IMF, said on Wednesday that the world’s largest economy had “held up” despite fears that record levels of tariffs on goods would cause a downturn and rising unemployment this year.

“When we met in April, many experts — not us — predicted a US recession in the near term, with negative spillovers to the rest of the world. Instead, the US economy as well as many other advanced and emerging markets, and some developing countries, have held up,” Georgieva said in a curtain-raiser speech before the IMF’s annual meetings next week.

The resilience of the global economy was the result of slightly lower overall effective tariffs than first feared, the IMF said. Georgieva said estimated US protectionism was due to hit 23 per cent in April, but after negotiations and some trade deals, the effective level of US protectionism reached 17.5 per cent — still the highest since the 1930s.

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