Global Inflation Rises as Conflict in Iran Disrupts Oil

The Bangko Sentral ng Pilipinas forecast that Philippine inflation likely rose to between 3.1% and 3.9% in March 2026, potentially marking the fastest growth pace in over two years. The central bank attributed these pressures to higher costs for fuel, electricity, and rice, as well as a weakening peso that reached a record low of P60.748 against the US dollar.

These economic shifts follow attacks by the US and Israel against Iran in late February, which led to the closure of the Strait of Hormuz. This critical transit point handles approximately 20% of global oil and liquefied natural gas production. BSP Governor Eli M. Remolona, Jr. indicated that the bank may tighten policy if oil prices reach a worst-case scenario of $200 per barrel.

Similar inflationary trends appeared in Europe. Portugal's annual consumer price inflation hit a seven-month high of 2.7% in March, driven almost entirely by rising fuel prices. Meanwhile, Bulgaria's National Statistical Institute reported that annual inflation reached 3.9% in March, fueled primarily by a 5.5% increase in transport costs.