The IMF is also warning today that global financial stability risks are “elevated”, due to the Iran war.

The Fund’s latest Global Financial Stability Report flags the risk that the inflationary shock from the conflict could cause funding markets to tighten, fuelling volatility in the bond markets.

The report says:

The global financial system is confronting the ongoing war in the Middle East, potential inflationary pressures, rising risks of further tightening in financial conditions, and several amplification channels that could lead from market turmoil to financial instability.

The IMF also identifies private credit defaults and a slowdown in AI investment as additional risks to stability.

A chief executive at an influential UK school trust has warned that the built environment sector is struggling to hire young people, despite the UK’s youth employment crisis.

Speaking at a committee meeting in parliament this morning, Terry Watts, chief-executive of the Built Environment School Trust, a charity aimed at improving access for young people to work in the sector, said that awareness around opportunities for young people is “not in a good state”, saying that although “exceptionally good programmes” that generate interest around the built environment exist, he described them as “very patchy,” and “uncoordinated.”

Watts also cited the issues that such programmes “tend to be focused around London and the south-east”, as well as how costly they can be to run on a daily basis.

Despite the built environment sector employing 12% of Britain’s workforce, and generating around 17% of the country’s GDP, Watts said of the thousands of students he works with, “94 per cent of them don’t want to work in construction when we meet them.”

And although youth unemployment has risen to its highest level since 2014 (16.1%), with concerns mounting over young people finding it harder to be hired across many sectors, they still appear to not be attracted to careers in the built environment.

It has a “no one wants to do that” stereotype, Watts said, adding that other industries including finance and tech are increasingly being seen as more attractive career paths.

He told a committee of politicians and Lords that there needs to be more work to help the sector appeal to young people, saying:

“We need people to aspire to go into this sector where you can start as a labourer on site. 20 years forward, you’re running a £10-20m turnover building company.

“There’s lots of social mobility opportunities for this sector. If only people knew they were there, they could aspire to do them.”

The TUC are calling for a temporary cap on gas prices to help UK businesses through the energy shock.

TUC general secretary Paul Nowak also firmly blamed Donald Trump’s decision to trigger conflict in the Middle East for the UK’s growth downgrade:

“This is the last thing working families need.

“Donald Trump’s illegal war of choice risks making us all poorer. The longer it goes on, the bigger the threat to our economy and to living standards.

“Households and firms are already being hammered by Trumpflation – especially gas-dependent industries like chemicals, ceramics and glass.

“That’s why the government must urgently bring forward a temporary targeted gas price cap to stabilise the price of gas for critical industries and protect British manufacturing – and press the accelerator on the energy support scheme making sure it reaches crucial sectors like steel.

“And longer-term, ministers must go all out to protect the country from a sustained Trump-slump – and ensure those with the deepest pockets shoulder the cost.”

The IMF’s growth downgrades show that the Middle East conflict has ‘blown a hole’ in the government’s economic plan, warns Lindsay James, investment strategist at wealth manager Quilter.

“The IMF has delivered a severe reality check to Rachel Reeves and the rest of UK government, with economic growth forecasts slashed heavily. It now expected economic growth for this year to come in at 0.8%, down from the 1.3% growth that was forecasted at the beginning of the year. The conflict in the Middle East has effectively blown a hole open in the economic plan the Labour government was embarking on, and without a significant calming of the tensions, the UK is expected to fare the worst of the world’s developed economies.

“The government came into this year hoping it would be one of stabilisation, with Budget concerns now out of the picture and the fiscal headroom being largened. The US-Iran war, however, has blown that off course and instead resulted in the UK suffering from increased energy prices and the potential for an inflationary shock. With interest rate cuts now firmly off the cards for now, and the potential for hikes very much live, economic growth is going to be hard to come by.

“It is hoped that much of this economic shock will be short-lived, provided the conflict does not drag on. The IMF expects the UK to recover to become the fastest growing G7 European economy in 2027 with growth of 1.3%, but with inflation also expected to be the highest amongst peers, there remains risk that further revisions could be made.

“None of this, of course, is helped by the fact that the longer the conflict goes on, the greater potential there is for an economic recession. The original ceasefire agreed already appears to have broken down, and while the bombing may have calmed, tensions remain ratcheted up. Even with any resolution, things are unlikely to go back to normal and we should now have to get familiar with elevated oil and gas prices for the foreseeable future.”

The IMF has “laid bare” the UK’s exposure to global shocks and fossil fuel price spikes by cutting its growth forecasts (see earlier post), says the IPPR think tank.

Responding to the latest IMF World Economic Outlook, Sam Alvis, associate director at IPPR, says:

“The IMF’s latest outlook paints a bleak picture and underlines a hard truth: the UK’s economy is still at the mercy of global crises.

Our dependence on volatile fossil fuels leaves households and businesses exposed to yet another wave of energy price shocks. We will need to protect people from the effects of this now but to stop us having to do so again in the future we need to invest in electrification and clean, homegrown energy.”

Q: Why is the UK’s downgrade bigger than other major economies?

There are two main reasons, replies IMF chief economist Pierre-Olivier Gourinchas:

Firstly, of course, the war in the Middle East – the jump in energy prices hurts the UK as it is “highly reliant” on gas for its energy mix.

Gourinchas explains:

Now a lot of this gas is produced domestically, but there is still a part of it that is imported. And, the part is imported is at market prices. It’s much more expensive. And that sets the price for energy in the UK in an environment in which, gas reserves are relatively low, when you compare them to other European countries.

So there is more of a pass through of gas prices into wholesale prices of energy, even if households are protected temporarily because there are there are some measures in place.

Secondly, the UK economy had a “relatively weak performance” in the second half of 2025, so there is a ‘carryover effect’ into 2026.

Q: Do you fear the UK could fall into a wage-price spiral again?

Gourinchas argues that the UK economy still has a negative output gap, which is moderating some wage pressures.

He says:

Right now there is little evidence that there are strong wage pressures in the UK economy and therefore our estimates of core inflation are not increasing too much.

The energy shock from the Iran war is as severe as the 1974 oil price shock, the IMF says, but the world economy is in better shape to cope.

Pierre-Olivier Gourinchas, chief economist at the IMF, tells today’s press conference that if the conflict were to stop today, the oil shortfall for the year would be comparable to the shock from the 1970s in terms of how much oil has been withdrawn from the market on an annual average basis.

He says:

So, the shock is comparable to the 1974 oil price shock.

But, there are important differences, Gourinchas says:

The first one is that the global economy is much less oil dependent now than it was back then, and it is much more efficient in terms of how much it needs oil to produce GDP.

Secondly, back in the ‘70s, central banks were focused on supporting activity rather than reining in inflation. “That led to macroeconomic instability,”Gourinchas explains.

The Middle East and North Africa region is expected to have a sharply slower growth this year as oil-exporting countries grapple with the fallout from the Iran war, the International Monetary Fund has predicted today.

The region’s real GDP growth forecast was slashed to 1.1% in the IMF’s latest World Economic Outlook, 2.8 percentage points lower than its January projection.

Growth across the region is expected to rebound to 4.8% in 2027.

Iran’s economy is forecast to shrink by 6.1% in 2026, followed by 3.2% growth in 2027. Before the war, it was expected to expand 1.1% this fiscal year.

The IMF also has advice for policymakers on how to handle the Iran war shock.

Pierre-Olivier Gourinchas, chief economist at the IMF, tells reporters at the Fund’s annual meeting that monetary and fiscal policy should be ready to pivot to support the economy and safeguard the financial system.

Central banks ‘must be attentive to risks’ and communicate that they are ready to act decisively to maintain price stability. But at the same time, they are facing a “negative supply shock. And no central bank can influence global energy prices on its own”, Gourinchas points out.

And how about finance ministers?

Gourinchas warns that fiscal space is much thinner than before. And he urges governments to deploy ‘targeted and temporary measures’, rather than wider-ranging support.

He says:

Price caps, subsidies, and similar interventions are popular, but they distort prices. They’re often poorly designed, hard to unwind, and extremely costly. Most countries don’t have that luxury anymore, where support for the most vulnerable is needed.

War in the Middle East has halted the world economy’s momentum this year, says Pierre-Olivier Gourinchas, chief economist at the IMF.

He is warning that the Iran war has darkened the global economic outlook, as the Fund presents its latest economic forecasts.

Despite major trade disruptions and policy uncertainty, last year ended on an upbeat note, Gourinchas tells journalists in Washington DC.

Gourinchas says:

The closing of the Strait of Hormuz and serious damage to critical facilities in a region central to global hydrocarbon supply raise the prospect of a major energy crisis should hostilities continue.

The IMF has also warned that a further escalation in the Iran war could trigger a global recession, spiralling inflation and a sharp backlash in financial markets.

Against an increasingly volatile backdrop, the Washington-based fund said the economic damage from the Middle East conflict was steadily rising as it cut its growth forecasts for 2026 based on the impact from the war so far.

Under a worst-case “severe scenario,” involving a drawn-out war and persistently higher energy prices, it said the world would face “a close call for a global recession” for only the fifth time since 1980.

Here’s the full story from my colleague Richard Partington, who’s at the Spring Meeting in Washington DC:

Chancellor of the Exchequer, Rachel Reeves, has responded to the IMF’s growth downgrade:

“The war in Iran is not our war, but it will come at a cost to the UK. These are not costs I wanted, but they are costs we will have to respond to. I have vowed that my economic approach to this crisis will be both responsive to a changing world and responsible in the national interest, keeping inflation and interest rates in check to protect households and businesses.

“We entered this conflict in a stronger position because of the choices this government took to build economic stability, but there is more to do. That is why we are strengthening Britain’s energy security, backing British industry and protecting households, to build a Britain that is stronger, more resilient, and prepared for the future.”

Newsflash: The International Monetary Fund has cut its forecast for UK growth this year and in 2026, as the Iran war hurts the global economy.

The UK has been hit by the sharpest growth downgrade in the G7 in the IMF’s new economic forecasts, just released, at its spring meeting in Washington DC.

UK GDP is now expected to rise by just 0.8% this year, down from a previous forecast of 1.3% – a bigger downgrade than other major economies.

The UK’s growth forecast for next year has been cut from 1.5% to 1.3%.

The Fund says:

In the United Kingdom, the war and a slower pace of monetary easing mean that growth is projected to decline from 1.3 percent in 2025 to 0.8 percent in 2026, a downward revision of 0.5 percentage point relative to the October 2025 forecast.

Growth is projected to recover to 1.3 percent in 2027, slower than expected before the war as the impact of higher energy prices linger.

In a blow to households, IMF economists also predict inflation will rise towards 4%.

But, inflation is then expected to return to target by the end of 2027 as the effects of higher energy prices fade and a weakening labour market puts downward pressure on wage growth.

US producer price inflation has hit its highest level in almost three years, due to the surge in energy costs.

The US PPI index, which measures prices ‘at the factory gate’, rose by 4% in the 12 months to the end of March, the largest increase since February 2023.

Prices for energy jumped in the month – the first since the Iran war began – by 8.5%, including a sharp move higher in motor fuel.

The US Bureau of Labor Statistics explains:

Nearly half of the March advance in the index for final demand goods is attributable to a 15.7% rise in gasoline prices.

The indexes for diesel fuel, jet fuel, home heating oil, meats, and primary basic organic chemicals also increased. Conversely, prices for fresh and dry vegetables fell 10.7%.

Amazon.com has secured an $11.57bn deal to buy satellite operator Globalstar, to accelerate the rollout of its satellite operation, Leo.

The deal will allow Amazon Leo to add direct-to-device (D2D) services to its low Earth orbit satellite network and extend cellular coverage to customers beyond the reach of terrestrial networks, the company explains.

Amazon says acquiring Globalstar’s network of non-geostationary orbit (NGSO) satellites is part of its “long-term vision for space-based connectivity”.

It will help Amazon to challenge Elon Musk’s Starlink satellite network.

Panos Panay, Senior Vice President of Devices & Services at Amazon, says:

“By combining Globalstar’s proven expertise and strong foundation with Amazon’s customer-obsession and innovation, customers can expect faster, more reliable service in more places—keeping them connected to the people and things that matter most.”

UK fuel prices appear to finally be levelling off after 43 days of increases, the RAC reports.

The motoring group argues that prices should now start to decline.

RAC head of policy Simon Williams explains:

Wholesale fuel costs are now significantly lower than they were at the start of the month, so forecourt prices should begin to come down. As things stand, we’d expect petrol and diesel to drop by several pence a litre in the next week or so.

“It will be very interesting to see if this plays out as the data indicates. We hope it does as drivers could do with some relief at the pumps with a tank of petrol for a family car now costing £87 and the diesel equivalent £105 - £14 and £27 more than they did at the start of the conflict.”

According to the RAC, petrol is averaging 158.30p a litre, while diesel is 191.54p a litre.

JP Morgan has reported a surge in profits as the Middle East conflict drove volatility in the financial markets.

Net income jumped 13% to $16.5bn in January-March 2026, up from $14.6bn in the first quarter of 2025.

Revenues at JP Morgan’s markets division reached a record $11.6bn in the quarter, while investment banking fees rose by 28% “due to stronger advisory and ECM [equity capital market] activity.”

JP Morgan’s CEO Jamie Dimon says the company faces ‘an increasingly complex set of risks’, including conflict and surging energy prices, saying:

“The U.S. economy remained resilient in the quarter, with consumers still earning and spending and businesses still healthy. Several tailwinds are supporting this resiliency, including increased fiscal stimulus, the benefits of deregulation, AI-driven capital investment and the Fed’s asset purchases.

At the same time, there is an increasingly complex set of risks— such as geopolitical tensions and wars, energy price volatility, trade uncertainty, large global fiscal deficits and elevated asset prices. While we cannot predict how these risks and uncertainties will ultimately play out, they are significant and they reinforce why we prepare the Firm for a wide range of environments.”

Axel Springer has confirmed it has received approval from the UK Department for Culture, Media and Sport (DCMS) to proceed with its acquisition of Telegraph Media Group.

It says the decision marks “a significant milestone toward completing the transaction”.

Mathias Döpfner, CEO of Axel Springer, says:

We are pleased to have received UK government approval to proceed with this acquisition. After a long period of uncertainty, we can confirm that we will invest significantly in The Telegraph’s editorial excellence and international growth.”

The acquisition will strengthen Axel Springer’s portfolio of premium journalism brands, which includes POLITICO, BUSINESS INSIDER, BILD, and WELT, among others. The Telegraph will join a global network committed to independent reporting while retaining its distinct editorial voice and British identity.

In the media world, Culture secretary Lisa Nandy has given permission for European media group Axel Springer is to acquire the Telegraph newspaper.

In a written statement to parliament, Nandy says she has given her written consent for RB Investco Ltd to sell its call option to purchase the Telegraph Media Group Holdings Ltd to Axel Springer.

Importantly, Nandy also says she is “not minded” at this stage to intervene in the proposed merger, under either the public interest media mergers regime and the foreign state influence regime, adding:

I am pleased to be able to take these positive steps, which give greater certainty to the Telegraph and its staff.

RB Investco is a joint venture between US private equity firm, RedBird Capital Partners LLC and Abu-Dhabi based media conglomerate, IMI. They dropped their £500m bid for the Telegraph Media Group last November, following concerns about links to China.

Axel Springer swept in with its a £575m deal in early March, scuppering a rival deal from the owner of the Daily Mail.

The surge in energy costs has pushed confidence among small US companies down to its lowest level in almost a year.

The National Federation of Independent Business has reported that its Small Business Optimism Index dropped 3.0 points to 95.8 last month.

That pushes the index below its long-term average for the first time since April 2025 (the month of Donald Trump’s ‘Liberation Day’ tariffs).

Higher energy costs wiped out the benefits from taxes cuts, NFIB found.

NFIB chief economist Bill Dunkelberg explained:

“The 20% Small Business Deduction and other supportive small business tax provisions in the Working Families Tax Cut Act have had many positives for small business owners.”

“However, the dramatic spike in oil prices has spooked consumers and owners alike. Small business owners are having to absorb those higher input costs and pass them along to their customers.”

The Iran war has led to the biggest rise in global energy inflation in at least 25 years, new data suggests.

Swiss bank UBS has analysed the latest inflation reports from advanced and emerging economies, and found that energy prices rose by 5.5% on average in March. That exceeds the surge seen after the onset of the Russia–Ukraine conflict in March 2022.

UBS tracks inflation across roughly 45 major advanced and emerging economies; 27 have reported March data so far.

Arend Kapteyn, global head of economic and strategy research, told clients:

The increases were broad-based. Around two-thirds of reporting economies registered monthly gains in the 97th percentile or higher of their historical distributions, reflecting the globally synchronised shock to energy prices triggered by developments in the Middle East.

That said, there were a few exceptions. Energy inflation declined in Sweden—mainly due to a sharp fall in electricity prices (March was the warmest month ever recorded in Sweden) which offset strong fuel price increases—as well as in Estonia and Slovenia, while Chile also recorded only modest increases.

UBS has also found that the rise in headline inflation inflation remains slightly below the peak reached in March 2022.

Thats’s because there was also acute supply-chain disruptions and exceptionally strong post-pandemic demand four years ago, which led to price rises across a broader set of goods and services.

Chancellor Rachel Reeves has blasted Donald Trump over his ‘folly’ for starting the Iran war without an exit plan.

In an interview with the Daily Mirror, Reeves says she is “very frustrated and angry” about the situation.

She says:

“This is a war that we did not start. It was a war that we did not want. I feel very frustrated and angry that the US went into this war without a clear exit plan, without a clear idea of what they were trying to achieve.”

“And as a result the Strait of Hormuz is now blocked,” the Chancellor added. “We are hosting a conference this week with President Macron of France on how to secure passage through the Strait of Hormuz.

Reeves (who is heading to Washington DC for the IMF’s spring meetings this week) points out that before the conflict, inflation was expected to fall, allowing more cuts to interest rates.

She adds:

“Obviously no sensible person is a supporter of the Iranian regime, but to start a conflict without being clear what the objectives are and not being clear about how you are going to get out of it, I do think that is a folly and it is one that is affecting families here in the UK but also families in the US and around the world.”

The European steel industry has said radical new measures to double tariffs on steel imports and halve duty-free quotas (see earlier post) will help pull the industry “back from the brink” of collapse.

Faced with unprecedented cheap imports from China and elsewhere, the industry has for the last year pleaded with Brussels to introduce trade measures to deal with the sheer volume of competition for local manufacturers.

Axel Eggert, director general of the European Steel Association (EUROFER), said:

‘European steel has been standing at the edge of a cliff and this trade measure helps pulls us back from the brink. By curbing unsustainable import pressure, it supports viable domestic steel capacity and enables the industry to continue its decarbonisation.

“It will bring back 15 million tonnes of EU steel-making capacity utilisation, while helping preserve around 30,000 direct jobs and 200,000 indirect jobs in Europe’’.

The new tariffs and quota system agreed in late night talks by the European Parliament and member states will see quotas imposed in each of the 28 steel product sectors and could impact exports from the UK as well as countries like China.

Newsflash: The International Energy Agency has cut its forecasts for global oil demand this year, as the Iran war drives up prices.

In its latest oil market report, the IEA warns that supply and demand will both be hurt by conflict in the Middle East.

Oil demand is now forecast to fall by 80,000 barrels per day in 2026, down from last month’s forecast that demand would rise by around 640,000 bpd.

That would be the first annual fall in demand since the 2020 Covid-19 pandemic, according to Bloomberg.

The IEA expects demand to fall sharply in the current quarter, in the fastest rate since 2020:

A forecast 1.5 mb/d 2Q26 decline would be the sharpest since Covid-19 slashed fuel consumption. Initially, the deepest cuts in oil use have come in the Middle East and Asia Pacific, mainly for naphtha, LPG and jet fuel.

However, demand destruction will spread as scarcity and higher prices persist.

The IEA also flags that global oil supply plummeted by over 10 million barrels of oil per day in March, to 97 mb/d. It says continued attacks on energy infrastructure in the Middle East and ongoing restrictions to tanker movements through the Strait of Hormuz have led to the largest disruption in history.

The IEA’s forcast is based on a scenario where regular deliveries of oil and gas from the Middle East to international markets resume by the middle of this year.

But, in a more pessimistic scenario where risks to energy production and trade in the Middle East remain high, “energy markets and economies around the world need to brace for significant disruptions in the months to come”, the IEA adds.

Away from the Iran war, the EU has agreed proposals to double tariffs on steel imports to 50% in a moved aimed at curbing Chinese imports but which the UK industry has previously said posed an “existential threat” to the UK industry.

The decision by the European Parliament and member states to approve the proposal, which will also see duty free quotas halved, will come into force in July and will replace the existing safeguards dating back to 2018.

At the same time a similar measure will be introduced by the UK whose policy up to now was aligned with the EU thanks to previous membership of the EU.

The EU is expected to later announce duty free quotas for third countries including the UK, with pressure on the bloc to be generous to the UK.

Negotiations will now start under World Trade Organization rules for quotas on 28 steel products.

Norway, Iceland and Liechtenstein will not be subject to tariffs as they are members of the European Economic Area, further highlighting the economic disadvantage of the UK.

The EU is the UK’s most critical market with about 78% of steel exported to the bloc, accounting for just under 1.9m tonnes in 2024.

The new quota, which will be split with all non EU and non EEA countries will be reduced by 47% to 18.3m tonnes a year.

Last October Alasdair McDiarmid, the assistance general secretary at steelworkers’ union Community, said the new measures posted “an existential threat” to the UK industry.

Stocks are pushing higher across Europe, following reports that peace talks to end the Middle East conflict could resume this week.

Reuters reported that negotiating teams from the U.S. and Iran could return to Islamabad this week, after talks last weekend in the Pakistani capital ended without a breakthrough.

Germany’s DAX share index has risen by 1%, while France’s CAC 40 is up 0.35% and Italy’s FTSE Mib is 0.6% higher.

Britain’s FTSE 100 is rising higher too – now up 28 points or 0.27% at 10,611 points.

Britain’s stock market has opened calmly, with the FTSE 100 share index rising by just 0.05%, up 5 points to 10,589 points.

Mining stocks are rising, led by Fresnillo (3.3%) and Antofagasta (+2.8%).

But tobacco firm Imperial Brands (-4.2%) are leading the fallers; it warned this morning that “the conflict in the Middle East has resulted in a more uncertain geopolitical and macro environment.”

The boss of banking giant HSBC has warned that the conflict in the Middle East is starting to hurt client confidence.

Georges Elhedery also told Bloomberg TV that broader “uncertainties” weighing on confidence too, saying:

“We’re saddened and concerned with what’s happening in the Middle East, and we’re concerned not just with what’s happened, but also with how long this will take.

Unfortunately, some of these uncertainties have initially started to weigh on general confidence.

“We worry that the continuation of this conflict will have that impact globally, way beyond the Middle East.”

The Middle East conflict has provided lucrative opportunities for BP.

The energy giant told the City this morning that it expects to post an “exceptional” results from oil trading in the first quarter of the year – a period in which the oil price spiked after the Iran war began.

BP is also predicting “stronger realized refining margins” for the quarter, but cautioned that its oil production & operations production will be “slightly lower” than in the fourth quarter of 2025.

UK chancellor Rachel Reeves is making the trip to Washington DC for the IMF/World Bank spring meeting.

Before crossing the Atlantic, Reeves warned that families and businesses across Britain are bearing the cost of instability “they did not cause”, adding:

“The Iran conflict must be a line in the sand on how we deal with global crisis and instability.

“I will go to America with a clear message: global leaders must take co-ordinated economic action and supercharge the path to energy security to protect ourselves in the future.”

The oil price is dipping today, on renewed hopes of a resolution to the Iran war.

Brent crude is trading below $100 a barrel again, at $98.35, even though the US blockade on Iran’s ports came into effect yesterday.

Investors are hopeful that Trump’s latest ratcheting up of the pressure on Tehran will help lead to a breakthrough in peace talks.

Michael Brown, senior research strategist at Pepperstone, explains:

President Trump’s blockade of the Strait of Hormuz got underway yesterday, applying to all vessels making their way to or from Iranian ports. Is this a negotiating gambit, designed to choke off Iranian oil revenues, and force Iran back to the table? Almost certainly, it is, with it being just the latest instalment of the ‘escalate to de-escalate’ strategy that markets have come to be so familiar with over the last 15 months or so.

That this latest manoeuvre is being viewed through this lens helps explain the relatively swift way in which markets were able to shrug off the weekend’s developments. Not only did stocks pare opening declines, allowing the S&P future to trade above its pre-conflict close and to turn positive on the year once more, but haven demand for the greenback evaporated as the day wore on, and Govvies rebounded to end proceedings a rounding error away from the unchanged mark.

Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.

Finance ministers, central bankers and economists from around the world are gathering in Washington DC, with the Iran war casting a gloomy shadow over the world economy.

The International Monetary Fund’s (IMF’s) and World Bank’s spring meeting is kicking off – later today, we’ll hear the Fund’s latest economic forecasts; they’re expected to include a cut to the growth outlook due to the Middle East conflict.

The Fund has already warned that the “economic scars” of war could take more than a decade to recover from.

Last night, the heads of the International Energy Agency (IEA), the IMF and the World Bank warned that the war was having a “substantial, global, and highly asymmetric” impact on the world economy, disproportionately affecting energy importers, in particular low-income countries.

They warn:

The shock has led to higher oil, gas and fertilizer prices, triggering concerns about food security and job losses as well. Some oil and gas producers in the Middle East have also seen a dramatic loss of export revenue.

With the US blockading the strait of Hormuz yesterday, the IMF, IEA and World Bank chiefs add:

“The situation remains very uncertain, and shipping through the Strait of Hormuz is yet to normalize. Even after a resumption of regular shipping flows through the Strait, it will take time for global supplies of key commodities to move back towards their pre-conflict levels—and fuel and fertilizer prices may remain high for a prolonged period given the damage to infrastructure.

They also warn that shortages of key inputs will hurt industries including energy and food, and that the war has forcibly displaced people, impacted jobs, and reduced travel and tourism.

The agenda

• 10am BST: IEA Oil Market Report

• 1.30pm BST: US PPI for March

• 2pm BST: IMF’s World Economic Outlook report published

• 3.15pm BST: IMF’s Global Financial Stability Report published