S&P Global Ratings
Economic Research
Our economists are responsible for developing the macroeconomic forecasts and risk scenarios used by S&P Global Ratings' analysts during the ratings process, as well as leading key cross-sector and cross-divisional research projects.
Global Economic Outlook Q3 2026: Tug Of War Between Hormuz Disruption And AI Investment Boom
The U.S.-Iran memorandum of understanding (MOU) is a potential game changer. While only the first step on the road to a full resolution, markets have reacted favorably and energy prices are down. Flare-ups and shuttle diplomacy since the signing of the MOU suggest that the path to the post-Hormuz new normal will be a rocky one.
We have not updated our energy price assumptions following the signing of the MOU. Despite some early spikes, prices for oil and gas have not risen as much as feared.
North America
Economic Outlook U.S. Q3 2026: Resilient To Layered Supply Shocks
U.S. economic activity has remained steady, and the agreement for an extended ceasefire in the Middle East is adding some upside potential, mostly because the plan diminishes (for now) an important channel of demand destruction—i.e., the disruption of traffic through the Strait of Hormuz.
The U.S. growth resilience does not come as a surprise to us. Our March forecast update emphasized that the U.S. has been far less exposed to a sharp increase in energy prices driven by the Middle East war due to substantial domestic energy production and lower energy intensity.
EMEA
Economic Research: Economic Outlook Europe Q3 2026: Energy Shock Rekindles Stagflation Risks
The Middle East war continues to affect macroeconomic conditions in Europe. Our new baseline is largely consistent with our interim forecast revision in April this year. This is because oil and gas price assumptions have changed only marginally since then and GDP growth in first-quarter 2026 was broadly in line with our expectations.
However, the balance of risks is shifting rapidly. While the probability of upside outcomes is increasing, a quick and sustained recovery in oil and gas flows remains uncertain. We therefore created two alternative scenarios--severe and milder--that are based on different assumptions for energy prices and financial conditions.
Asia-Pacific
Economic Outlook Asia-Pacific Q3 2026: AI-Exposed Markets To Outperform
The Asia-Pacific economic outlook is shaped by resilient global activity, energy market stress, and an AI-driven tech export boom. While growth is largely holding up, our forecast revisions differ materially across economies as energy shocks, export performance and domestic conditions interact.
Emerging Markets
Economic Outlook Emerging Markets Q3 2026: Inflationary Pressures Will Persist
Despite the gradual reopening of the Strait of Hormuz, S&P Global Ratings continues to expect upward pressure on inflation in most emerging markets in the coming months.
The initial U.S.-Iran peace deal is an important step toward normalizing the flow of goods through the Strait of Hormuz, however, uncertainties around the implementation of the deal, including the potential for negotiation setbacks, will keep a risk premium on the prices of goods that transit through the strait.
Climate Economics
Net-Zero Transition Stutters As Geoeconomic Risks Increase
Geoeconomic security concerns are reshaping the transition to net-zero emissions. Immediate risks take precedence over long-term sustainability goals, even though global emissions keep rising.
Weaker climate policy commitments and trade tariffs will slow progress toward net zero, with less public funding available to derisk net-zero technologies and emerging markets. This reduces private sector incentives to invest in clean technologies.
Asia-Pacific (APAC)--particularly China--and the EU will continue to lead the development and adoption of clean technologies. Yet diverging industrial and trade policies will likely continue to create tensions.