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Business inflation expectations return to pre-war levels in the Middle East
Publication: ECO
Author: Diogo Mendo Fernandes
Source published: 07/10/2026, 15:03:32 UTC
Briefing created: 29/10/2026, 08:58:10 UTC
Based on a feed excerpt; full article content has not been acquired. Source evidence retrieved 07/10/2026, 15:11:24 UTC.
Briefings
Portuguese and Eurozone companies reported higher price expectations after the Middle East conflict began, mirroring pre-war levels but with distinct supply-demand dynamics. While 27% of firms anticipated price increases post-conflict, this contrasts with the 2022 Ukraine war period where demand recovery drove similar expectations. The study, published in the October 2026 Economic Bulletin, compares these responses against the initial Russian invasion, noting that post-conflict price hikes were more contained than the initial shock.
Key points
- Companies in Portugal and the Eurozone reported higher price expectations after the Middle East conflict began, with 27% anticipating price increases in the next three months, mirroring pre-war levels.
- The Ukraine war in 2022 saw 34% of firms in Portugal and 44% in the Eurozone anticipate price increases, driven by supply shocks and demand recovery, whereas the Middle East conflict showed more contained price variations.
Context
The findings come from the European Commission's quarterly business survey, published in the October 2026 Economic Bulletin. This data compares post-conflict price expectations against the initial Russian invasion, revealing that while both conflicts saw similar short-term price anticipation, the underlying economic drivers differed significantly.
Limitations
The evidence is limited to the October 2026 Economic Bulletin, which relies on quarterly business survey data. The study does not account for regional variations beyond Portugal and the Eurozone, nor does it include data from other conflict zones like the Middle East or Iran. Uncertainty remains regarding the long-term impact of these price expectations on actual inflation trajectories.
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