Iran conflict strains emerging markets, JPMorgan projects Qatar 9% contraction
The conflict involving Iran is causing real trouble for emerging markets. In just two months, countries are dealing with higher prices, tougher borrowing, and messy trade slowdowns.
Qatar's feeling it the most. It just saw its first-ever $1.2 billion trade deficit and JPMorgan projected the economy could contract by as much as 9% this year following damage to key liquefied natural gas infrastructure.
Energy prices surge, policymakers grow hawkish
Thanks to the conflict, energy prices have shot up and inflation is spreading fast, making life harder for both people and central banks.
Growth forecasts for these economies are now down to 3.9%.
The Philippines recently raised interest rates, while policymakers in several other countries have taken a more hawkish stance.
Fossil fuel subsidies reach $725 billion
With all this chaos, global fossil fuel subsidies reached an estimated $725 billion in 2024, especially in regions affected by the conflict, making it even tougher for governments to manage their finances as borrowing gets more expensive.