The conflict in the Middle East poses a notable geopolitical risk. However, it has not disrupted the improving structural outlook for the global economy over the medium to long term.

In the absence of sustained oil supply disruptions or tighter global dollar liquidity, historical precedent suggests that financial markets can absorb shocks of this nature and should rebound as confidence grows that the situation remains contained.

Uncertainty remains elevated, but the United States and nearly all global economies share a strong vested interest in restoring the uninterrupted flow of energy and essential manufacturing inputs.

FOR AN IN-DEPTH LOOK
Strategy Insights Second Quarter 2026