IMF projections show Bhutan’s economy growing faster than the regional average, even as rising consumer prices and a widening current account deficit pose challenges through 2027
The country is projected to maintain strong economic growth over the next two years, but rising inflation and a widening current account deficit could complicate the country’s economic outlook, according to figures published in the International Monetary Fund’s (IMF) World Economic Outlook of October 2026.
The projections show Bhutan’s real gross domestic product (GDP) growth moderating from 8.2 percent in 2025 to 7.0 percent in 2026 and 6.9 percent in 2027. While the pace of growth is expected to ease, Bhutan’s projected performance remains above the regional average for emerging and developing Asia.
The same outlook, however, points to mounting price pressures. Consumer prices in Bhutan are projected to rise by 5.6 percent in 2026, up from 2.6 percent in 2025, before increasing further to 6.5 percent in 2027.
At the same time, the country’s current account deficit is projected to widen from 16.0 percent of GDP in 2025 to 16.3 percent in 2026 and 17.7 percent in 2027. The combination of relatively strong growth, higher inflation and a widening external deficit highlights the challenge of translating economic expansion into stable prices and a more sustainable external position.
Bhutan’s projected growth compares favourably with the broader Asian outlook. The IMF table places emerging and developing Asia’s growth at 5.6 percent in 2025, declining to 5.1 percent in 2026 and 4.9 percent in 2027. The projected growth of 7.0 percent in 2026 and 6.9 percent in 2027 would therefore remain above the regional rates.
Bhutan is expected to sustain comparatively rapid economic expansion even as growth across emerging and developing Asia moderates.
Consumer price inflation is one of the most notable changes in Bhutan’s projections. After recording 2.6 percent in 2025, inflation is projected to reach 5.6 percent in 2026 and 6.5 percent in 2027.
Current account deficit remains a key concern
The external balance presents another challenge. Bhutan’s current account deficit is projected at 16.0 percent of GDP in 2025, widening to 16.3 percent in 2026 and 17.7 percent in 2027.
This contrasts sharply with emerging and developing Asia, which is projected to record current account surpluses of 2.5 percent of GDP in 2026 and 2.6 percent in 2027.
A current account deficit means that, overall, payments to the rest of the world exceed receipts through the transactions covered by the account. A widening deficit can increase the importance of securing sustainable external financing and maintaining adequate foreign exchange buffers.
The figures do not provide Bhutan-specific unemployment projections, and it does not establish whether the expected growth will translate into higher employment or household incomes. The projections point to continued expansion, while highlighting economic pressures that will require close monitoring through 2027.
Bhutan joined the IMF on September 28, 1981 and holds a quota of 20.4 million SDR (Special Drawing Rights) and 26.26 million in SDR holdings. The IMF Executive Board concluded Bhutan’s most recent Article IV Consultation in January 2026, highlighting post-pandemic recovery while noting ongoing risks such as hydropower delays, global slowdowns, and crypto valuation volatility.
Meanwhile, a delegation from Bhutan, led by the Finance Minister and the Governor of the Royal Monetary Authority (RMA), is in Bangkok, Thailand, to participate in the 2026 Annual Meetings of the IMF and the World Bank Group (WBG), scheduled for 12–18 October 2026.
Tashi Namgyal, Thimphu
