The global economic outlook hinges on how long the war in the Middle East lasts, with recession in some countries and sharply higher inflation a real possibility if it drags on into next year, the Organisation for Economic Co-operation and Development warned on Wednesday.
Oil prices eased on Thursday as Israel and Lebanon’s ceasefire agreement boosted hopes for a broader deal to end the U.S.-Israeli war with Iran, while the U.S. House approved a resolution seeking to curb President Donald Trump’s war powers.
U.S. manufacturing activity increased more than expected in May, hitting the highest level in four years, likely driven by businesses front-loading orders amid rising prices and shortages because of the war with Iran.
U.S. construction spending increased more than expected in April, boosted by single-family homebuilding, though rising mortgage rates amid the war with Iran continued to cast a shadow over the housing market.
Central banks in the Middle East, Central Asia and the Caucasus need stronger protection from political pressure and government financing demands to keep inflation in check, an International Monetary Fund paper said on Tuesday, as the Middle East war revives price risks across vulnerable economies.
The Trump administration issued a sweeping demand to Mexico to raise the level of regional content in North American-built cars and trucks to 82% to qualify for preferential trade deal access, with 50% of that value produced in the United States, four people familiar with the U.S. negotiating stance said on Friday.