Latest global economic developments around 14H00 GMT on Wednesday, the 33rd day of the conflict in the Middle East:
Wall Street opens higher, banking on de-escalation in the Middle East
An air of optimism prevails on Thursday in the stock markets, focusing on the latest remarks from US President Donald Trump considering a US withdrawal from the war in Iran within two to three weeks.
At the start of trading, the Dow Jones gained 0.69%, the Nasdaq rose 0.70%, and the broad S&P 500 index increased by 0.56%.
Shortly before 12:00 GMT, major European indices all rose by over 2%: London (+2.04%), Paris (+2.08%), Frankfurt (+2.82%), and Milan (+3.33%).
France Fuel: Government to implement energy-saving measures in case of supply issues
The French government will be required to implement energy-saving measures in case of fuel supply difficulties, spokeswoman Maud Bregeon stated on Wednesday, without specifying these measures.
SP95-E10 reached the symbolic mark of 2 euros per liter on Wednesday in France, based on data from 7,289 gas stations transmitted to the French government.
Since February 27, the day before the first Israeli-American strikes on Iran causing a surge in oil prices, SP95-E10 has increased by 28 cents per liter in mainland France, a jump of 16.26%.
Fuel prices also soar at the pump in the Emirates
An increase of over 30% for petrol and 72% for diesel: fuel prices at the pump are also soaring in the United Arab Emirates, a major oil producer, a month after the start of the war in the Middle East.
Although lower compared to those experienced by drivers in Europe, these prices are set at 3.39 dirhams (0.92 dollar) per liter of petrol and 4.69 dirhams (1.28 dollar) per liter of diesel, as decided by the public commission responsible for setting them each month.
Middle East war threatens financial stability, warns Bank of England
The economic shock brought about by the war in the Middle East poses risks to the stability of the British financial system, cautioned the Bank of England (BoE) on Wednesday.
The conflict “represents a negative supply shock for the global economy and increases the likelihood of inflationary pressures, higher interest rates, and slower growth worldwide,” notes the BoE in its report released on Wednesday following the quarterly meeting of its Financial Policy Committee (FPC) held on March 27.
Germany: Middle East war hinders expected economic recovery
The energy shock triggered by the war in the Middle East will “dampen” the recovery of the German economy, which will rely on additional public investments, warned major German economic institutes on Wednesday.
According to these institutes, the German gross domestic product (GDP) will grow by 0.6% in 2026 and 0.9% in 2027. These forecasts represent a decline of 0.6 and 0.5 percentage points respectively compared to those from the autumn.
French manufacturing industry hit by Middle East war in March
French manufacturing output decreased in March due to the impact of the war in the Middle East, which intensified pressures on prices and supply chains, according to the PMI index published on Wednesday by S&P Global.
“The results of the latest PMI survey highlight the immediate impact of the war in the Middle East on the French manufacturing sector,” emphasized Joe Hayes, chief economist at S&P Global. Data collected between March 12 and 24 “indicate a rapid tightening of supply conditions,” he added.
UK to host international meeting this week to secure the Strait of Hormuz
The UK will host a meeting of about thirty countries this week to mobilize efforts to restore and secure maritime transportation in the Strait of Hormuz, announced British Prime Minister Keir Starmer on Wednesday.
“The UK has now brought together 35 nations around our declaration of intent to stand together for maritime security in the Gulf. Later this week, Foreign Secretary (Yvette Cooper) will host a meeting of these countries for the first time,” declared the Labour government leader at a press conference in Downing Street.
Dollar falls as hope for an end to war grows
The dollar weakened on Wednesday against most major currencies, fueled by growing hopes for an end to hostilities in the Middle East following statements from Donald Trump, which have increased stock markets, lowered oil prices, and consequently reduced the US dollar.
The decline in oil prices “helps soften the dollar,” emphasized Swiss Quote analyst Ipek Ozkardeskaya, as it eases current inflation concerns. This also suggests a less resolute tone from the US Federal Reserve (Fed) in raising interest rates, easing tensions on the greenback.
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