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Mohamed A. El-Erian, industry influencer, outlines the economic impact of the Middle East war as a process unfolding in four distinct stages.
According to El-Erian, the global economy has spent the past nine weeks navigating the initial phases: a narrow price shock affecting energy and borrowing costs, followed by broader inflationary pressures.
A recent conflict involving the U.S., Israel, and Iran has disrupted global dealmaking as Gulf investors reconsider major spending priorities, according to previous reports. The surge in petrol prices linked to the Iran war has also raised concerns for energy markets, with early signs of demand destruction, the Financial Times reported. These developments have contributed to heightened market caution over the past several weeks.