Economist: US-Iran Agreement Reduces Recession Risk but Does Not Change Outlook

Odaily Planet Daily News According to a report by Ben May and Bridget Payne of Oxford Economics, although future setbacks may still occur, the US-Iran agreement reduces the risk of a sustained decline in oil inventories that could ultimately trigger a global energy price surge and lead to a recession. However, they noted that this does not automatically mean the volume of oil flowing 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."

"That said, 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 curb inflation but will have a limited boost to economic growth, this news further strengthens their view that the Federal Reserve and the Bank of England will not raise interest rates, and other central banks that have already completed rate hikes will not do so again. (Jinshi)