Economic growth in the US was slower at the end of 2025 than initially estimated, and inflationary pressures persisted at the start of this year, underscoring vulnerabilities in the economy even before the conflict in Iran began.
While consumer spending rose in January, economists are worried that consumption will take a hit from the conflict-fueled surging oil prices, the impact of which is already being felt at US gas pumps.
Along with unexpected job losses last month, the economic data, coupled with the volatility from the Iran war, complicates the US Federal Reserve’s decision on interest rate cuts, putting stagflation on policymakers’ radar.
“All the key measures are moving in the wrong direction,” one analyst told The New York Times.
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