Europe
The main macro takeaway for Europe is that supply security and pricing risk are back in focus, even without an outright disruption. Developments around the Strait of Hormuz, fuel costs and possible US tariffs show how quickly geopolitical tension can feed into European business conditions.
A French-owned ship passing through the Strait of Hormuz appears to be the first such transit by a major European firm since the conflict began. That matters because it offers a tentative sign that trade routes are still functioning, but it does not remove the underlying risk premium tied to one of the world’s key energy chokepoints.
That caution is reinforced by Aurigny’s warning that there is no jet fuel shortage for four to six weeks, even as it is paying 120% more for fuel than before the war. For Europe, that points less to immediate scarcity than to a cost shock that could squeeze airlines, travel demand and transport-sensitive sectors if elevated prices persist.
Trade policy is adding to the strain. The US threat of 100% tariffs on pharmaceuticals unless firms strike a deal raises the prospect of pressure on a major European export industry, even if generic medicines are excluded. For European manufacturers, the signal is that access to the US market may become more conditional and more expensive.
Domestic operating conditions also remain difficult. The call from the M&S boss for more action on crime and abuse of staff highlights a separate but meaningful drag on retailers, with higher security costs and disruption adding to already thin margins. Consumer complaints over subscription traps, while not a macro driver on their own, also speak to household sensitivity around recurring costs.
Against that backdrop, the stronger-than-expected US jobs gain in March suggests external demand has not rolled over despite the Iran war. For Europe, the combined message is mixed: growth support from the US is still there, but energy, shipping and tariff risks could keep inflation pressures sticky, complicate policy decisions and leave markets focused on supply shocks rather than a clean growth rebound.