Iran War Forces Central Banks into Tighten-or-Break Dilemma

The 2026 Iran war's energy shocks have upended global monetary policy, with EM central banks pausing cuts amid surging inflation and dollar strength. IMF forecasts show EM growth slashed to 3.9% and inflation at 5.5%, widening gaps with advanced economies. This multipolar tightening risks capital flight, de-anchored expectations, and a synchronized global slowdown if oil persists above $100.