Suez disruption: a new inflation risk on the horizon

A lengthy disruption of shipping via the Suez Canal could push up prices and weigh on economic growth, particularly in Europe, which is already struggling with a perilous combination of high inflation and economic contraction.

The following looks at the potential macroeconomic costs associated with the disruption after attacks by Yemen’s Iran-aligned Houthi militants on ships in the Red Sea forced firms to halt or reroute traffic.