Skip to main content
Subject:

Global Financial Markets

Inflation, stagflation or deflation

Thursday, 02 July 2026, written by Edward Markus

It is striking how differently economists and analysts view the implications of the Iran deal and the rise of AI for economic growth and inflation. If we look at the charts for gold, the yield curve, the S&P 500 and the dollar index, the markets’ expectations are quite clear. In this report, we examine what these market expectations are, how we view them, what role China’s rise plays in this context, and what this means for key interest rates and exchange rates.
 

This report is published: Bi-weekly

Get access to this report

Request Report

Previous reports

Oil prices fall, but the risk of inflation remains

Thursday, 18 June 2026

Following the deal between Iran and the US, energy prices have fallen and a major risk factor is now behind investors. Does this clear the way for falling inflation and further rising share prices, or will the Fed put new obstacles in the way in the form of higher interest rates?

Request Report

Is AI a bubble?

Thursday, 04 June 2026

Expectations regarding the positive impact of AI on the economy and profits are running high. Rightly so, but the share prices of AI-related companies have risen so sharply that the risk of disappointment regarding the profitability of AI investments has increased significantly. For the time being, we believe that developments in this area and what happens in the Strait of Hormuz will be decisive factors for the financial markets.

Request Report

Markets may be at a major turning point

Thursday, 21 May 2026

Unfortunately, there doesn’t ring a bell at the top. However, a number of developments are currently underway that suggest a significant stock market peak is imminent or has already been reached. If we are proved right and stock prices fall in the coming months, this will, via the wealth effect, also affect economic growth and, consequently, interest rates and exchange rates.

Request Report

Eddy's Weekly Market Insight

Friday, 26 June 2026

Eddy's Weekly Market Insight

What's moving the markets? Until recently, whenever tensions in the Middle East escalated, the price of oil would rise, causing interest rates to rise as well. At the same time, the dollar would strengthen and share prices would fall. These were all understandable reactions in themselves, as rising oil prices fuelled fears of stagflation. After all, higher oil prices not only drive up inflation but also slow economic growth. The latter applies least of all to the US, as the US is largely self-sufficient in energy. This is in contrast to Europe and Japan, so it was entirely logical that the dollar would strengthen as oil prices rose. Recently, however, tensions in the Middle East have eased considerably, causing oil prices to fall sharply. This should have led to lower interest rates, a weaker dollar and rising share prices. On balance, however, the opposite happened. How is this possible?
Continue reading
— Edward Markus, Founder & Chief Economist