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<Research>G Sachs: Iran Conflict Triggers Energy Shock, ST Negative Impact on Asia; Oil Prices Expected to Rise 20% More for Rest of Yr
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A report by Goldman Sachs indicated that the conflict in Iran and the resulting energy supply shock are certainly adversities for Asia, at least in the short term. China, India, Japan, and South Korea are the world's four largest net importers of crude oil (and were also among the top seven natural gas importers last year). The latest forecast from Goldman Sachs' commodity research team showed that crude oil prices will rise by more than 20% for the remainder of the year, and natural gas prices will hike by more than 30%, with the risk of further upward movement. Goldman Sachs said that the surge in energy prices complicates the previously optimistic outlook for 2026 for many economies (particularly China, Japan, and tech-exporting countries), and in more adverse scenarios, could completely undermine this outlook. In South Korea, Goldman Sachs still projected the Bank of Korea to keep rates intact and gradually downplay aggressive rate hike expectations at the front end of the Korean rate curve. The Korean won has been a pressure release valve, and before the energy price trend becomes clear, the won may face some resistance, but it is believed to have significant appreciation potential in the medium term. In Japan, Goldman Sachs maintained its previous forecast that the next rate hike by the Bank of Japan will occur in July, followed by another hike in January 2027. In China, Goldman Sachs foresaw the economy remains polarized, with strong manufacturing and exports but weak housing and consumer spending. The main risk to short-term export growth is apparently the energy shock and a potential radical slowdown in global economic activity. However, from a market share perspective, China's highly competitive manufacturers are expected to achieve further growth in the coming years. AASTOCKS Financial News Website: www.aastocks.com |
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