The US-Iran conflict is expected to keep fuel and food prices elevated well into 2026, according to economists. The warning comes as consumers already dealing with sticky inflation face a new supply-side shock tied to the conflict's effect on global energy markets. Iran is a significant oil producer and sits near the Strait of Hormuz, through which roughly 20% of the world's oil supply passes. Any disruption to shipping in that corridor pushes up crude prices globally, which feeds directly into gasoline costs at the pump. Higher fuel costs also raise the price of transporting food, which adds pressure to grocery bills. The transmission is straightforward: costlier crude raises pump prices within weeks, and those higher logistics costs ripple through food supply chains over the following months. That lag means even a short conflict can produce price effects that outlast the fighting itself. Watch for how long the Strait of Hormuz remains under stress and whether major oil producers step in to offset lost supply. Either factor could shorten or extend how long American households feel the economic pressure.
Pakistan's economy grew 3.7 percent in FY2026, its fastest rate in four years, according to the Pakistan Economic Survey presented by Finance Minister Muhammad Aurangzeb. Growth beat last year's 3.18 percent but missed the 4.2 percent target, with floods, regional conflict, and weaker food exports cited as key drags.
The Union government released an additional Rs 1,09,019 crore in tax devolution to states on August 1, 2026, separate from the regular monthly transfer. The lump-sum release aims to accelerate state capital spending in the July-September quarter, with Uttar Pradesh, Bihar, and Madhya Pradesh among the top recipients.
US mortgage rates have risen to a one-year high as markets weigh Federal Reserve rate uncertainty and Middle East conflict-driven inflation fears. Higher rates increase monthly payments for new buyers and are likely to further suppress housing market activity and refinancing.
Pakistan's Sensitive Price Index rose 13.52 percent year on year for the week ending July 2, 2026, marking 45 consecutive weeks of annual gains. Electricity up 49 percent, wheat flour up 68 percent, and LPG up 44 percent year on year are the main drivers.
