Economist: US-Iran agreement reduces recession risk, but does not change the outlook

Odaily Planet Daily News: Ben May and Bridget Payne of Oxford Economics stated in a report that although there may be further setbacks in the future, the US-Iran agreement reduces the risk of a sustained decline in oil inventories that could ultimately lead to a surge in global energy prices and a subsequent economic recession. However, they indicated 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.

Nevertheless, our current short-term oil price forecasts still appear to be on the high side," they added. Since the reopening of the Strait of Hormuz is likely to help lower inflation but has a limited boost to economic growth, this news further reinforces their view that the Federal Reserve and the Bank of England will not raise interest rates, and other central banks that have already completed their rate hikes will not hike again. (Jin Shi)