Central bankers and economists warn prolonged conflict could raise retail prices and rip up growth forecasts
Middle East crisis – live updates
An inflation shock triggered by the US-Israel attack on Iran could wreck a fragile global economic recovery that had been expected to gain momentum this year.
With oil and gas prices spiking, despite a pledge from Donald Trump to protect tankers making their way through the crucial strait of Hormuz shipping chokepoint, central bankers and economists have warned that a prolonged conflict could increase retail prices around the world and force them to rip up growth forecasts for this year.
On Friday, the International Monetary Fund managing director, Kristalina Georgieva, said a 10% increase in energy prices that persists for a year would push up global inflation by 40 basis points and slow global economic growth by 0.1-0.2%.
