Forward View Global - The war drags on

20 May 2026
Economy and Markets

Key points

• NAB still see a moderate, negative, impact on global growth from the Iran war, assuming the Strait of Hormuz re-opens soon. If it does not, the growth consequences are likely to be far more consequential.
• Q1 GDP has held up globally, but only the tail end was war-affected. The impact of the Iran war is still flowing through, with early signs of disruption evident in Asian industrial production and falling service sector PMIs.
• We now expect the Fed to hold through to end 2027. While we still see the labour market weakening from here, inflation risks have risen. 

Visit the report for the full set of global forecasts from NAB Economics and Markets Research.