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Economists: U.S.-Iran Deal Reduces Recession Risk, but Does Not Alter Outlook
Svmuu News: In a report, Ben May and Bridget Payne of Oxford Economics stated that while there may still be setbacks ahead, the U.S.-Iran agreement reduces the risk of a sustained decline in oil inventories that could ultimately trigger a surge in global energy prices and lead to an economic recession.However, they noted that this does not automatically mean oil flows through the Strait of Hormuz will increase faster than previously expected. “We had already assumed that shipping through the Strait of Hormuz would resume by the end of July. Nevertheless, our current short-term oil price forecasts still appear to be on the high side.”They added that since the reopening of the Strait of Hormuz is likely to help reduce inflation but will have only a limited boost on economic growth, this news further reinforces their view that the U.S. Federal Reserve (Federal Reserve) and the Bank of England will not raise interest rates, and that other central banks that have already completed their rate hikes will not raise rates again. (Jin Shi)
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