• ICG analysis flagged rising macro risks from Middle East war, with Strait of Hormuz closure pushing energy prices higher while equity markets stayed resilient, led by S&P 500 at fresh record highs.
• Severe scenario assumed Hormuz not reopening until July, with ECB-linked modelling pointing to Brent near USD 150/bbl, remaining above USD 100/bbl in 2027, with natural gas peaking at EUR 106 per MWh versus about EUR 47 currently.
• Eurozone growth under that case seen turning modestly negative for two quarters before rebounding in 2027, with US and UK still expected to post slower but positive growth.
• Headline inflation projected to jump but core pressures seen contained versus 2022, reducing likelihood of large-scale rate hikes; swap pricing implied Fed on hold through 2026, with ECB and BoE seen delivering three 25 bp increases each.
• Longer-dated government bond yields expected to remain elevated on fiscal funding needs and higher inflation risk premia, with US singled out as particularly exposed given debt trajectory.

Disclaimer: This news brief was created by Public Technologies (PUBT) using generative artificial intelligence. While PUBT strives to provide accurate and timely information, this AI-generated content is for informational purposes only and should not be interpreted as financial, investment, or legal advice. ICG plc published the original content used to generate this news brief on May 13, 2026, and is solely responsible for the information contained therein.