Iran conflict limits rate cut room for emerging markets
Oil price spikes following the Iran conflict have forced emerging market central banks to pause rate cuts. Policymakers now face rising inflation risks.
Xurve View
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Xurve View
The oil price surge triggered by the conflict involving Iran has stalled the momentum for interest rate cuts across emerging markets. Central banks from Poland to Turkey are now forced to confront rising inflation expectations and a shift toward risk aversion. This development follows a period where policymakers had finally regained optimism regarding global economic stability after the shocks of the pandemic and the invasion of Russia into Ukraine.
