Not only is the war itself driving sharp moves in oil, gas and global freight prices, but normally key indicators — including Wednesday and Friday’s U.S. inflation releases set before the war broke out — are being overshadowed by risk.
Away from the Middle East, China will remain busy with its “two-session” meetings, while in Latin America, Colombia holds congressional elections and presidential primaries ahead of presidential elections at the end of May.
Here’s everything you need to know about next week in the markets by Amanda Cooper and Alvin John in London, Lewis Kraskov and Rodrigo Campos in New York, and Gregor Stuart Hunter in Singapore.
1. The smoke of war
The Middle East conflict has provided an unpleasant reminder of how quickly energy price shocks can emerge. After Israel and the US launched their attack on Iran on February 28, oil prices rose nearly 20%, while European natural gas rose nearly 60%. Some of the most popular trades of the past year – from emerging market equities to silver and tech stocks – have been ignored, as investors race to cover losses elsewhere. The dollar, which has lost nearly 10% of its value in 2025, has risen against nearly all major currencies, while gold has temporarily ditched its safe haven and instead served as a tool to contain losses.
Many investors expect the conflict to last only a few weeks before some kind of definitive resolution is reached. But the area of surprise in both directions is obviously large.
2. Pre-war prices
Traders will get a double whammy of U.S. inflation data next week as turmoil in the Middle East raises fresh doubts about the Federal Reserve’s rate cut plans and the resilience of the broader economy.
The figures won’t necessarily capture this week’s oil and gas prices, but should still make for interesting reading.
Wednesday’s February consumer price index is expected to have risen 0.2% on the month, a Reuters poll showed, after moderation in rent inflation and — wait for it — cheaper gas helped produce January’s low reading.
Another marker comes out on Friday with January’s Personal Consumption Expenditure (PCE) price index. Taken together, the reports will provide a snapshot of inflation trends ahead of the Fed meeting in late March, even if events have almost certainly reached them.
3. Not such a good place
France will host G7 finance ministers and central bank governors next week to discuss the Middle East crisis.
Markets will be watching closely as concerns grow that rising oil and gas prices could make major central banks quiet again.
A prime example is the European Central Bank, where investors now see a year-end rate hike more likely than expected — a sharp turnaround from last week, when another cut was still on the table. So much for ECB President Christine Lagarde’s “good spot”.
Reflecting the market’s bullishness, Germany’s price-sensitive two-year yield is on course for its biggest weekly rise in a year. For UK gilts, it is the biggest since late 2024, with traders now betting that the Bank of England will cut rates this month.
Also on the radar: Friday brings a heavy slate of European sovereign rating revisions, including Germany, Italy and Spain. The Turkish central bank’s rate decision on Thursday will be a cut-or-hold cliffhanger given the problems ahead.
4. Keeps China busy
China will provide an update on the health of its economy next week.
Monday brings inflation data for February, with trade figures for the first two months of the year due on Tuesday. Lending data may also appear, although its timing is usually fluid.
These figures will provide the basis for decisions on the “Two Sessions” – the annual meeting of the national legislature, the National People’s Congress, and the Chinese People’s Political Consultative Conference, the top political advisory body.
The eight-day event, which opened on Thursday and runs until March 12, is likely to generate its biggest headlines yet with the announcement of a 4.5-5% growth target. But next week’s data will highlight the challenges in meeting this.
5. Pre-election postering
Colombia holds congressional elections this weekend in a vote seen as an early indicator for the presidential race at the end of May. This coincides with the intra-Afghan presidential election, which should clarify which candidates have the momentum.
Polls suggest the presidential race is changing, with the ruling Pacto’s historic coalition replaced by leftist candidate Iván Cepeda, while right-wing outsider Abelardo de la Esparilla could benefit in a runoff as rivals fall apart.
For investors, the key question is how the outcome will shape the next president’s ability to govern.
A split result in May will likely keep markets steady. A strong opposition movement could support the currency and lift Colombian bonds, while gains for the left could send them the other way if fiscal concerns return.
