Look Forward | Episode 29: Middle East Tensions: Power, Pressure Points, and Pathways

In this episode of Look Forward, host Aries Poon discusses the macroeconomic implications of the Middle East conflict with Paul Gruenwald, Global Chief Economist at S&P Global Ratings. Paul explains how the crisis has evolved through three stages, flow shock, supply shock, and market shock—with the current focus on physical shortages and depleted buffer stocks, especially in energy-importing countries with limited resilience. He highlights that the conflict has neutralized earlier growth tailwinds, increasing downside risks and complicating the policy landscape as inflation rises while economic output slows.

The episode underscores how the unsynchronized global economy—with the U.S., Europe, and China experiencing divergent impacts—amplifies these risks. Central banks are largely in “hawkish hold” mode, with potential rate hikes ahead if inflation pressures persist, all amid a fragile, fragmented global recovery.