United States and Israeli strikes escalate Iran tensions into a regional crisis

The latest escalation in the Middle East has moved from geopolitical tension to full market risk transmission, with oil prices, currency markets and global growth forecasts now firmly in the crosshairs of investors. With multiple conflict scenarios ranging from contained escalation to prolonged regional war or regime instability, economists are now shifting from modelling risk to pricing it. For economies like South Africa, the shock is not direct, but comes through inflation pressures, capital flows and commodity price movements, particularly oil and gold. How long this risk premium persists and whether the global economy is entering a period of sustained volatility.Sanisha Packirisamy, Chief Economist at Momentum Investments explains what this means for SA.