Euben C. Paracuelles

Asia stands at a critical juncture. The transition from a unipolar to a multipolar world order, China’s rise and the AI revolution have all unleashed simultaneous shocks, including supply-chain realignments, geoeconomic fragmentation, rising economic nationalism and increased volatility. For a region that has thrived under open trading systems, these shifts are challenging the growth models of both developed and emerging Asian economies alike.

Following the US and Israel joint military operation targeting Iranian military infrastructure, leadership sites and nuclear-linked facilities, Iran launched missiles and drones at Israel and US bases in multiple Gulf states, causing an oil price shock impacting oil importing nations. Here we discuss the economic impact, policy response, winners and losers, as well as the equities and FX implications for Asia.