Global Investment Opportunities across the Middle East

Property rates have come under pressure after a period of strong growth, with current data from the Dubai Land Department revealing a drop in mortgage deals and cash sales. Nonetheless, we think the risk of a lasting migrant outflow and an extreme recession in the genuine estate sector is low.

As a lasting US-Iran offer takes shape, the fallout from the conflict has tightened local monetary conditions, exposing vulnerabilities through capital outflows, wider bond spreads, and weaker financier sentiment. Many GCC sovereigns carry fairly little debt and funding risks are therefore restricted in the UAE, the reserve bank's liquidity management has actually alleviated instant issues.

That stated, Bahrain has actually been able to depend on assistance from neighbours, consisting of Saudi Arabia and the UAE, and it effectively raised $1bn from an oversubscribed sovereign bond sale this month, marking the first offering from the area because the war started. High-frequency financial information underscore the stress on regional public financial resources from the dispute.

ANSR July GCC PRs 50DR+

Foreign Capital Opportunities across the GCC

In Saudi Arabia, the budget plan deficit more than doubled to SAR125.7 bn, or about 9% of GDP in Q1, driven by a decline in oil revenue and a surge in costs, especially on subsidies, reflecting contingency investments connected to the regional environment and an acceleration of Vision 2030 spending. In Qatar, the crisis brought oil and gas income to a halt, swelling the deficit spending to the biggest given that 2017.

GCC inflation dynamics stay uneven, with food rates the main source of upward pressure and inflation in this classification strengthening in Kuwait, Oman and Qatar. By contrast, food inflation stays reasonably subdued in Saudi Arabia, likely reflecting the mitigating result of its larger domestic food production base and greater supply-chain durability.

We continue to see cost pressures as mainly temporal instead of indicative of a sustained inflationary cycle. Appropriately, we expect typical inflation to reduce to 2.1% y/y in 2027 as momentary supply-side pressures dissipate. With near-term inflation elevated and transit through the Strait likely set to resume gradually, we anticipate the US Federal Reserve to keep rates of interest on hold until December, and local rate policies to do the same.

We anticipate Iran's GDP to shrink by 10.8% this year (we forecast a 9.4% contraction three months ago). Oil production and exports, which offer necessary revenue and FX inflows, have been cut by the US naval blockade, while non-oil activity has been badly hit. In Iraq, oil exports have actually collapsed to a trickle and we're anticipating GDP to contract by around 22% this year, with a sharp 33% rebound in 2027 as oil exports normalise.

By contrast, Syria continues to reintegrate into the worldwide economy after more than a decade of civil war. We expect GDP growth to typical 9.6% over 2026-2027, supported by restored investment, especially in banking and energy, financial reforms, and the steady reopening of regional trade links.

Emerging Stock Trading Trends for 2026

The World Bank has actually slashed its 2026 growth forecast for Middle East economies, saying total GDP growth in the region is anticipated to slow from an estimated 3.6% in January to 1.8% for 2026. The closure of the strategic Strait of Hormuz, and damage of energy and public infrastructure, had actually disrupted markets, increased monetary volatility, and deteriorated the 2026 development outlook, the World Bank Group said in its Economic Update for the Middle East, North Africa, Afghanistan and Pakistan.

The April 2026 World Bank's Macro Poverty Outlook anticipates that the region's aggregate (excluding the Iran) GDP growth will decelerate to 1.8 percent in 2026, down from 4.0 percent estimated for 2025. The 2026 projection has been downgraded by 2.4 percentage points because the January projections, showing the negative results of the continuous conflict.

Saudi Arabia: Forecast was reduced by 1.2 portion points since January. Development is now anticipated to slow from 4.3% in 2025 to 3.1% in 2026, keeping in mind that Saudi Arabia's outlook stays the strongest amongst Gulf economies. United Arab Emirates: Growth forecast for the UAE has fallen by 2.7 portion points considering that January.

Qatar: Notably, growth forecast for the Qatari economy has seen a sharp decline of 11.0 portion points because January. The economy is now expected to record a contraction of 5.7%, down from an approximated growth of 5.3%, due to severe obstruction to melted gas supplies. Qatar is an essential player in the worldwide energy market, with a worldwide market share of melted gas (LNG) supplies ranging between 20% and 21%.

Kuwait relies completely (100%) on the Strait of Hormuz to export its unrefined oil and derivatives. Closing the strait would mean a total shutdown of the country's financial lifeline, right away halting profits inflows to the state budget plan. Bahrain: Growth projection for Bahrain's economy has declined by 1.8 percentage points given that January.