There remains enormous uncertainty over how the conflict in the Middle East will play out from here. But the scenarios we have laid out suggest the Gulf economies will almost certainly record negative GDP growth this year. Economies in North Africa are …
12th March 2026
The Q1 PREA consensus for returns of 6.8% p.a. over 2026-30 is significantly above our call for returns of 5.2% p.a. Our view that appraised cap rates have further to rise is behind that difference, and we are below consensus across all sectors bar senior …
With the FOMC set to keep the fed funds target range between 3.50% and 3.75% next week, the focus will be on any changes to the policy statement and new economic projections. The most hawkish outcome would be if the Fed removed its easing bias from the …
The relative resilience of the S&P 500’s ‘big-tech’ sectors since the US and Israel attacked Iran is a stark contrast to their underperformance when oil prices surged in 2022. It might reflect ‘ degrossing ’, following the recent struggles of software …
All of our coverage of the macro and market implications of this conflict can be found here . Major Latin American economies are seen as potential beneficiaries of higher energy prices, reflecting in large part their stronger net energy export positions. …
Our Emerging Markets Chart Pack has been updated to focus on the implications for EMs of the conflict in the Middle East. The conflict will lead to sharp falls in GDP in the Gulf economies and weigh on energy importers, especially in Asia. EM energy …
The SNB is sure to leave its policy rate unchanged at zero next week. And higher oil and gas prices, as well as our revised ECB forecast, mean we think rate cuts are now unlikely this year. However, the pass-through from energy prices to inflation will be …
A handful of goods still driving large moves Gold, pharmaceuticals and IT equipment were once again the main drivers behind moves in the trade deficit in January, while limited revisions to preceding months’ figures suggest little change to fourth-quarter …
News of a record release of emergency oil reserves has quickly been overshadowed by images of tankers on fire in the Strait of Hormuz. Thirteen days into the conflict, tensions in the Middle East appear to be escalating rather than easing. What is the …
Strength unlikely to last Housing starts were strong in January, despite the poor weather, but permit data suggest that February’s number will be weaker. Meanwhile, the recent rebound in Treasury yields due to the Iran conflict means that housing …
This has been updated to reflect our new Baseline forecasts. Even in our adverse scenario, we have assumed the fiscal support for households and businesses is smaller than the £50bn in 2022/23, mainly because the rise in energy prices is smaller and …
Weakness in exports and wholesale sales suggests GDP may have fallen in January The plunge in exports in January, together with the large decline in wholesale sales volumes, points to downside risks to the flash estimate that GDP was unchanged at the …
Inflation falls back, odds slightly in favour of 50bp next week Inflation in Brazil fell to 3.8% y/y in February which keeps an interest rate cut in play at next week’s meeting, despite the energy price shock. Much will depend on developments in the …
ECB will not raise interest rates next week but will strike a hawkish tone. If energy prices stay at current levels, ECB would leave policy unchanged this year. But if energy prices rise a lot further, rate hikes could come as soon as April. The ECB is …
A protracted energy price spike would trigger tightening Turkey’s central bank (CBRT) opted to leave interest rates unchanged today, suggesting that – for now – it deems the effective 300bp of tightening delivered via the interest rate corridor sufficient …
Energy price shock brings 4% target into sight India’s headline consumer price inflation remained relatively low in February but this pre-dates the energy price shock from the Middle East conflict. We had assumed that headline inflation would only rise …
Bank to sit tight and wait to see the size of the coming energy inflation shock Different sizes and lengths of shock could lead to a wide range of paths for Bank Rate But markets may have gone too far pricing out rate cuts and pricing in the chance of …
The Bank of Japan faces a very different challenge from most of its global peers. While many central banks are debating when to begin easing policy, the BOJ is considering how quickly it should continue tightening. The recent rise in global energy prices …
The new Five Year Plan will play a critical role in guiding Chinese policy over the coming years, with important ramifications for both the domestic economic outlook and for China’s ties with its trading partners. Our economists discussed the Plan’s …
Resources exports rose strongly last year, driven by a jump in iron ore exports. However, the bigger picture is that global steel output is past its peak and a sustained pick-up in mining investment is unlikely. While lithium exports have great long-term …
Middle East developments temper the improving housing market February’s RICS housing market survey suggests that the events in the Middle East are dampening buyer sentiment and appear to have tempered the strengthening in the housing market at the start …
Provided that crude oil prices don’t rise much further, their recent increase won’t lift inflation to levels that the Bank of Japan would find intolerable. But with underlying inflation holding up better than the Bank is anticipating, we’re bringing …
All of our coverage of the macro and market implications of this conflict can be found here . The increase in energy costs brought about by the conflict in Iran could hit commercial real estate returns either through squeezed occupier margins and …
11th March 2026
Government bonds shrugged off US inflation data and remain at the mercy of developments in the Middle East. This Capital Daily outlines the current state of play in global government bond markets. US CPI data for February showed a modest 0.22% m/m gain in …
All of our coverage of the macro and market implications of this conflict can be found here . The sharp rise in energy prices threatens to raise the cost of energy subsidies across many emerging markets. Those governments with the largest subsidy bills …
We’re continuing to support client decision-making during the Middle East conflict with comprehensive but concise analysis and daily online briefings. All of our key analysis on this crisis can be found here . Below are some highlights from our coverage …
All of our coverage of the macro and market implications of this conflict can be found here . Higher oil prices are positive for the Canadian economy and will boost inflation but, unless prices rise significantly further and stay there for several …
The March IPF consensus survey, conducted before the Iran conflict, forecasted all-property total returns of 7.7% p.a. over 2026-30 which, aside from a downgrade to 2026, was essentially unchanged from the December forecast round. We therefore remain more …
All of our coverage of the macro and market implications of this conflict can be found here . The possibility of fewer interest rate cuts than we expect, or even rate hikes, and the possible hit to the economy from the surge in energy prices due to the …
Egypt hasn’t been involved directly in the conflict in the Middle East but it is one of the most vulnerable EMs to the indirect effects, especially higher energy prices and tighter global financial conditions. Officials’ response in the form of allowing …
Core PCE deflator likely rose by more than core CPI The modest 0.22% m/m gain in the core CPI in February is not as good news as it first seems, with our preliminary estimate pointing to a 0.42% gain in the core PCE deflator. That would maintain the wide …
All of our coverage of the macro and market implications of this conflict can be found here . Turkey’s economy is better placed to face the current energy price shock than it was in 2022, but it is still among the more vulnerable EMs. A temporary price …
All of our coverage of the macro and market implications of this conflict can be found here . A record-breaking release of emergency oil reserves could cushion a lack of supply from the Middle East and provide some relief to oil prices. However, this …
Even though fiscal policy in Germany is being loosened significantly, signs of a recovery in activity have been tentative at best. Our base case remains that activity will pick up this year but a sustained period of higher energy prices could throw a …
All of our coverage of the macro and market implications of this conflict can be found here . Weak core inflation pressures in South Africa mean that the Reserve Bank is less likely to rule out monetary easing in the face of the energy price shock than …
Private credit funds have attracted growing scrutiny amid falling valuations and exposure to software companies. Under a severe default scenario, losses might amount to around 0.4% of US GDP. That would be material but manageable and far from systemic, …
Our three scenarios show what the Middle East conflict could mean for petrol prices, utility prices, CPI inflation, GDP growth and interest rates in the UK. We first published three scenarios to help clients understand the risks posed by the conflict in …
High energy prices and growing concerns over energy security have already prompted significant policy responses across Asia. Some governments are looking to introduce inflation-suppressing measures such as subsidies or price caps, but these provide …
10th March 2026
All of our coverage of the macro and market implications of this conflict can be found here . Hopes that an end to the war in the Gulf could be in sight appear to be growing. While that justifies the stabilisation in financial markets over the past day …
All of our coverage of the macro and market implications of this conflict can be found here . The US’ position as a modest net energy exporter means a world of near $100 oil prices would not be particularly bad news for the economy. The impact on real …
In a survey of the global macro consequences of this war that was originally published by Chatham House, Group Chief Economist Neil Shearing showed why, provided the surge in energy prices proves fleeting, the world economy may absorb the shock with less …
All of our coverage of the macro and market implications of this conflict can be found here . This note assesses the macro and commodity ‑ market implications of three potential scenarios for the Iran war. In the most benign – a severe but short ‑ lived …
All of our coverage of the macro and market implications of this conflict can be found here . The conflict in the Middle East has triggered a major shock to energy flows from the region, sending prices of oil and natural gas soaring. Shipments of …
A version of this note was originally published by Chatham House on Friday, 6th March. With the war with Iran in its second week, the most immediate and tragic costs are measured in lives lost. Yet economists are obliged to consider another dimension: the …
