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03 April 2026 / Quick Take
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Copy LinkThe escalation of the Middle East conflict is already reshaping corporate expectations across Europe. What had been a stabilizing macroeconomic environment, with growth momentum accelerating and inflation near target, is now characterized by slower growth, rising inflation, and heightened uncertainty. Firms are now increasingly anticipating a material impact on 2026 performance.
Executives in Europe overwhelmingly expect the conflict to act as a material but manageable headwind. A majority (51%) anticipate a moderate impact requiring forecast adjustments, while 33% expect significant or severe disruption affecting margins, growth, or operations. Notably, no respondents expect zero impact, underscoring the broad-based nature of the shock.
This distribution suggests that companies are moving from contingency planning to active adjustment, recalibrating expectations rather than undertaking structural transformation. The primary transmission channels—energy prices, supply disruptions, and macroeconomic spillovers—are already feeding into cost structures and business planning, reinforcing a baseline of earnings p
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