Analysts: The Federal Reserve and the European Central Bank may ignore the Middle East shock.

03/06 07:40

Marco Valli and Daniel Vernazza from Yuxin's investment research institute stated in a report that the military action against Iran seems likely to last for weeks, allowing the central bank to ignore recent turmoil. After that, tensions and energy disruptions are expected to ease. The two chief economists said: "In our baseline scenario, we still expect the Federal Reserve to cut interest rates only once this year, while the European Central Bank will remain on hold until as late as 2027." They added that the risks for the European Central Bank this year have shifted from additional monetary easing to premature tightening.
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