Energy and Commodities

El Niño 2026–27 could be exceptional, but its impact will not depend on intensity alone: local climate conditions, timing, and sectoral exposure will be key. Granular analysis can help anticipate risks, while adaptation can mitigate their effects

Argentina establishes itself as a key player in the global agricultural market, excelling in the production of soybeans, corn, wheat, and sunflower. The sector is a crucial source of foreign currency, with agricultural complexes projected to contribute 42% of the country's total exports in 2026.

Economic activity in Peru grew 3.6% year-on-year in July, exceeding forecasts. The dynamism of non-primary sectors, such as construction and commerce, was the main driver, offsetting the weakness in primary sectors, which were affected by climate anomalies and a contraction in fishing.

Headline inflation increased by 0.7 pp, to 4.3% year-on-year, while core inflation decreased by 0.1 pp, to 2.9%, in line with expectations. In September, headline inflation could rebound to 4.7%-4.9%, driven again by energy and, to a lesser extent, by food.

Global climate governance has moved from framework-building to delivery. Despite progress, implementation and ambition remain off track for Paris. COP31 should therefore be judged by whether commitments translate into measurable, financed, accountable and climate-consistent action.

Middle East tensions have triggered high oil market volatility. The closing of the Strait of Hormuz created upward price pressure, but global reserves limited the impact to 4%. Uncertainty remains, with price scenarios dependent on the conflict's evolution and US political factors.

The euro area faces renewed inflation risks following the failed ceasefire in the Middle East. The longer the conflict persists, the more buffers will be depleted, increasing the risk of non-linear effects and of the shock spreading to the broader economy.