Slower growth, weird deflation

The OECD’s interim outlook says the Middle East energy shock has pushed headline inflation materially higher across the G20 and now flags a G20 inflation profile markedly above prior forecasts for 2026. (oecd.org ) For the United States the OECD and market reporting show a sharp near‑term jump in consumer prices, with an OECD‑quoted U.S. inflation projection rising to about 4.2% in 2026 from roughly 2.6% the year before. (bloomberg.com ) The World Bank’s Commodity Markets Outlook quantifies the other side of the split: an aggregate commodity‑price index set to decline about 7% in 2026, with more than half of individual commodities forecast to fall. (worldbank.org ) That report points specifically to a broad oil surplus — market summaries put the 2026 oil oversupply near 1.2 million barrels per day and model Brent drifting toward roughly $60 a barrel by year‑end, a key driver of the commodity disinflation signal. (markets.financialcontent.com ) The IMF has mobilized country desks to run contingency scenarios focused on nations with active programs, warning that surging oil and gas costs and fertilizer disruptions are straining revenues while the fund currently has programs with about 50 countries, roughly $166 billion of credit outstanding and a lending capacity cited near $1 trillion. (bloomberg.com ) Deal activity reflects the split: GlobalData’s Financial Deals Database shows total announced deals fell about 7% year‑on‑year in January–February 2026, with M&A volumes down roughly 12% and private‑equity deal volume plunging about 32% in that window. (retailbankerinternational.com ) Market analysts and central bankers are already reacting to the competing signals—reports note policymakers weighing tighter policy if energy‑led inflation persists even as commodity disinflation eases price pressures for net importers, and ECB officials have reportedly discussed the possibility of a rate move in April. (bloomberg.com )