Pantheon Macroeconomics: Despite Oil Price Retreat, Future May Still Face Significant Inflation Shock

Odaily News Pantheon Macroeconomics economists stated that despite the drop in oil prices following the agreement on a two-week ceasefire, the impending inflation shock will still be significant. He said: "The ceasefire agreement removes the prospect of an April rate hike, which we have always considered an unlikely scenario anyway, but we still maintain the view that the European Central Bank will implement a slight policy tightening this summer." Although the market welcomed the ceasefire, Iran could still restrict traffic through the Strait of Hormuz. He added: "Tehran has learned from this crisis that it can exert significant pressure on the United States by controlling the Strait, and we see no reason why Iran would not leverage this now." (Jin10)