Allianz Chief Economic Advisor: Middle East shocks are pushing global central banks into a "higher for longer" interest rate environment

ChainCatcher news, according to Golden Ten Data, Mohamed A. El-Erian, Chief Economic Adviser at Allianz, stated in an article that the price shocks triggered by the Middle East war have pushed market expectations towards an environment of “higher interest rates maintained for a longer period,” covering almost all systemically important central banks, with the only exception being the Bank of Japan. He pointed out that the current situation, combined with the negative demand shock brought by “second-round effects,” carries a potential risk of spreading to financial instability, highlighting the uncertainty of the outlook.