The National Oceanic and Atmospheric Administration (NOAA) has raised the probability of a strong El Niño event to 81% for the October-to-December period, signaling one of the most intense weather patterns since 1950.
The forecast introduces a significant new variable for global supply chains, particularly for emerging markets that are already navigating elevated energy costs and geopolitical instability in the Middle East.
JPMorgan economists have previously warned that a rapidly intensifying El Niño, combined with higher energy prices, could add approximately 0.
The convergence of climate volatility and geopolitical friction poses a dual threat to commodity prices.
El Niño typically disrupts agricultural output in key exporting regions, potentially driving up food prices, while simultaneously affecting energy demand and supply logistics.
For emerging economies, which often have less fiscal buffer to absorb external price shocks, this combination could reignite inflationary pressures that central banks have been working to contain.
JPMorgan economists have previously warned that a rapidly intensifying El Niño, combined with higher energy prices, could add approximately 0.3 percentage points to global inflation next year.