"The OECD cautioned that prolonged instability could lead to global energy shortages, especially if critical infrastructure or shipping routes are affected. Such a situation would increase business costs, fuel inflation, and further hinder economic growth."
"Rising fertiliser costs present an additional threat. The Middle East is a major supplier of key inputs such as urea and ammonia, and any shortages could cause global food prices to spike, further straining household finances."
The OECD forecasts that the UK will experience higher inflation and weaker economic growth due to the conflict in the Middle East. UK inflation is projected to average 4% in 2026, significantly higher than previous estimates. The GDP growth forecast for 2026 has been downgraded to 0.7%, making it the second-slowest in the G7. Disruptions from the conflict could lead to energy shortages and increased business costs, while rising fertiliser prices threaten food affordability. Overall, G20 growth is expected to weaken before a gradual recovery by 2027.
Read at London Business News | Londonlovesbusiness.com
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