Euro zone firms see new inflation surge if war lasts months, ECB poll shows

Euro zone firms warned that a war in Iran lasting months could trigger a new inflation surge similar to the post-COVID episode by disrupting supplies of fuel, hydrogen and helium. The ECB survey highlights renewed upside risks to price pressures and supply chains, with potential spillovers to energy and industrial inputs across the region. The message is market-relevant because prolonged geopolitical disruption could lift inflation expectations and complicate policy and business planning.

Analysis

Euro zone firms warned that a war in Iran lasting months could trigger a new inflation surge similar to the post-COVID episode by disrupting supplies of fuel, hydrogen and helium. The ECB survey highlights renewed upside risks to price pressures and supply chains, with potential spillovers to energy and industrial inputs across the region. The message is market-relevant because prolonged geopolitical disruption could lift inflation expectations and complicate policy and business planning.