UOB House View

Global Macro

Geopolitical risks in the Middle East remain elevated and highly uncertain, despite tentative signs of de‑escalation. The continued blockage of the Strait of Hormuz and damage to regional energy infrastructure pose significant risks to global growth and inflation, particularly for energy‑importing Asia. Sustained high oil prices could materially lift ASEAN inflation and dampen growth over the next 6–12 months, although most regional central banks are likely to look through supply‑side shocks unless FX weakness intensifies. Near‑term fiscal measures such as subsidies and temporary energy tax cuts are expected to partially offset the macroeconomic fallout.