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OECD lifts US inflation outlook
The Organisation for Economic Co-operation and Development (OECD) has sharply lifted its inflation forecast for the United States, warning that conflict in the Middle East and persistent trade pressures will keep price growth well above central bank expectations through 2026. In its latest interim outlook, the Paris-based body projected U.S. headline inflation will reach 4.2% in 2026, up from a previous estimate of 2.8% and significantly higher than the 2.7% forecast published last week by the Federal Reserve (the Fed). The revision underscores the growing divergence between international assessments of inflation risks and the Fed’s baseline scenario. The OECD attributed the upward revision primarily to energy market disruption stemming from the Iran conflict and the residual effects of U.S. tariffs, which continue to feed into global prices. In its report, the organisation said a prolonged period of elevated energy costs would “add markedly to business costs and raise consumer price inflation, with adverse consequences for growth”. A key transmission channel is the disruption to shipments through the Strait of Hormuz, a critical artery for global oil and gas flows. The OECD warned that any sustained closure coul
Outlook
AI boom could worsen wealth inequality: BlackRock CEO
The artificial intelligence boom could worsen wealth inequality unless more people can share its gains, BlackRock CEO Larry Fink said in a letter to shareholders. Fink encouraged broader participation in investment, saying that this could help distribute market gains from technologies like AI. “The vast majority of wealth has flowed to people who owned assets, not to people who earned most of their money by working,” Fink wrote. “Now AI threatens to repeat that pattern at an even larger scale—concentrating wealth among the companies and investors positioned to capture it.” In the letter, Fink said that providing children with investment accounts at birth could aid in wealth-building and allow more people to invest. The United States has begun offering these early wealth-building accounts for children born between 2025 and 2028, with the Treasury Department saying almost 3.5 million accounts had been opened by 6 March. “We’ll see how these accounts evolve, but if they are structured thoughtfully, and paired with existing investment vehicles for education and retirement (like 529 and 401(k) plans), this could be a very significant step toward more young Americans growing with their country,” wrote Fink. Skilled tra
Outlook
After the Iran war: A long road back for markets
Save a prayer till the morning after: The strains of this immortal 1980s Duran Duran classic could be aptly applied to the global economy the day after the United States-Israel war with Iran finally peters out. While markets will clearly bounce on the news that the war is over, there’s growing speculation over exactly how long it could take for the global economy to resemble anything close to normalcy. U.S. President Donald Trump’s plans for having his “mission accomplished” moment appear all but dashed, especially given Iran's unwillingness to give up now, resembling the Black Knight scene from the 1975 film Monty Python and the Holy Grail, which mocks the limbless, unstoppable, stubborn warrior. By all accounts, the Iran war will end sooner rather than later, as Trump faces huge political pressure in an unpopular war and the Iranian capability that is rapidly degrading. However, that could still be weeks away, and oil prices could still go higher before they come down.AftershocksWhile the [Iran] war coming to an end is one thing, getting the global economy back on track is quite another matter. Shane Oliver, chief economist with AMP, suspects that post-war aftershocks (aka slow-thaw recovery) – notably deep-seated di
Outlook
Iran war threatens to derail emerging market resilience
Due to surging oil prices, supply chain disruptions, and capital outflows to safe-haven assets, the bull run experienced by emerging markets (EMs) in 2025 – when the MSCI EM Index returned 34.3% - looks at risk of being derailed by the threat of protracted United States-Israeli air strikes on Iran. While EM stocks continued their bull run in 2026, up 9% in January alone, the MCSI EM Index slid by around 2% at the start of this week. Nowhere was that plunge more evident than in South Korea and Thailand, where share market indices plunged by more than 8% in early March 2026. BlackRock has been a recent cheerleader of EMs – highlighting key drivers of a positive outlook for the asset class, and has also flagged China’s new economy as a strong EM theme, backing leaders in AI, as well as automation and renewable energy. Only last month, Jean Boivin, head of BlackRock Investment Institute, concluded within his Staying positive on emerging markets commentary that the bullish themes that drove EM outperformance in 2025 are still playing out. Based on trade policy uncertainty easing since last year’s so-called ‘Liberation Day’ tariff announcements, the firm expects EMs to continue to benefit from a risk-on stance, supportin
Outlook
UK growth cut to 1.1%; Reeves defends plan
Chancellor Rachel Reeves said her economic plan is the right one even in uncertain times, despite growth estimates for the United Kingdom being lowered for this year. “(It’s) a plan that is even more important in a world that, in the last few years, has become yet more uncertain,” she said. This comes as the Office for Budget Responsibility (OBR) cut its expected growth rate for 2026 to 1.1% from the 1.4% it predicted in last year’s budget, but has upgraded estimates for later years. The OBR also said that it expects inflation to be lower this year than previously thought. It is important to note that these estimates were finalised before conflict broke out in the Middle East, and the OBR noted that such an outbreak could have a “very significant” impact on the global and UK economies. “It is incumbent on me and on this government to chart a course through that uncertainty to secure our economy against shocks and protect families from the turbulence that we see beyond our borders,” Reeves said. According to Reeves, the plan would see the economy grow and leave people £1000 better off. According to the OBR forecast, inflation is expected to drop to 2.3% through the year, down from its estimate of 2.5% in Novemb

Outlook
Fed's Williams: Tariffs hit US firms, households
American businesses and households are absorbing the overwhelming share of President Donald Trump’s tariffs, according to John Williams, in remarks that directly challenge White House assertions that foreign exporters would shoulder the cost. Speaking at a conference in Washington, D.C., the president of the Federal Reserve Bank of New York said recent analysis shows the burden has fallen squarely at home. “The tariffs have overwhelmingly been borne domestically — a New York Fed analysis estimates that most of the burden has fallen on U.S. firms and consumers.,” Williams said. “In addition, the tariffs have already meaningfully increased U.S. prices of imported goods, and the full effects have likely not yet been felt.” The findings stem from a white paper published on the New York Fed’s website, in which researchers estimated that as much as 90% of the added costs from tariffs had been passed through to domestic producers and consumers. That conclusion contradicts claims by President Donald Trump and other administration officials that foreign exporters would absorb the higher costs rather than raise prices. The study has generated significant debate in recent weeks. Kevin Hassett, director of the National Econo
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Fed officials urge caution on rate cuts
The United States Federal Reserve should refrain from cutting interest rates until there is clearer evidence that inflation is moving sustainably back towards target, Chicago Fed President Austan Goolsbee said, warning that price pressures remain uncomfortably high. Speaking at the National Association for Business Economics annual conference in Washington, Goolsbee stressed that policymakers must avoid repeating past mistakes by easing too quickly. Inflation has retreated significantly from its peak but remains above the central bank’s 2% objective. “We have been burned by assuming transitory inflation” in the past, Goolsbee said, cautioning against complacency. “I feel that front-loading too many rate cuts is not prudent in that circumstance,” he added. “People express that prices are one of their most pressing concerns. Let’s pay attention. Before we cut rates more to stimulate the economy, let’s be sure inflation is heading back to 2%.” The latest data for December showed core inflation, which strips out volatile food and energy components, running at 3% under the personal consumption expenditures index, the Fed’s preferred gauge. That marked a 0.2 percentage point rise from November. While some of the increase
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Refund risk clouds US fiscal outlook
While markets were hoping the United States Supreme Court would draw a line under President Donald Trump’s tariff experiment, it has torn up the rule book and left bond traders, currency desks and policymakers guessing what comes next. The court ruled that Trump overreached by using the International Emergency Economic Powers Act - a law designed for national emergencies - to impose sweeping tariffs. In plain English, it said taxing imports is Congress’s job, not the President’s, yet it stopped short of clarifying whether the roughly US$170 billion already collected must be refunded. That omission has created a lot of uncertainty. If businesses successfully sue for refunds, Washington faces a funding gap at a time when deficits are already running red hot. The U.S. government spends more than it collects annually, and it plugs the deficit by issuing bonds - aka Treasuries - to investors. More bonds mean more supply, and greater supply typically means higher yields, which are simply the interest rates the government pays to borrow. The White House responded within hours, pivoting to Section 122 of the 1974 Trade Act. That provision allows a temporary tariff — up to 15% for 150 days — without congressional
Outlook
Fed split over rate path, minutes show
The United States Federal Reserve signalled deep divisions over the future direction of interest rates at its January policy meeting, with officials broadly agreeing to hold rates steady but split over what should come next. Minutes from the 27–28 January meeting of the Federal Open Market Committee (FOMC) showed policymakers were united in keeping the benchmark rate unchanged, but differed sharply on whether further cuts, a prolonged pause, or even rate hikes could be warranted depending on inflation and labour market developments. “In considering the outlook for monetary policy, several participants commented that further downward adjustments to the target range for the federal funds rate would likely be appropriate if inflation were to decline in line with their expectations,” the meeting summary said. However, that conditional support for easing was counterbalanced by caution among others who argued the central bank should remain on hold until clearer evidence emerged that inflation was firmly returning to target. “Some participants commented that it would likely be appropriate to hold the policy rate steady for some time as the Committee carefully assesses incoming data, and a number of these participants judged t