Back to today’s briefing

Story perspectives

JPMorgan: Super El Niño May Raise US Inflation 0.3% in 2027

7/25/2026

42 6 Full Breakdown

Summary

Story summary

JPMorgan warned that an El Niño and energy prices could add 0.3 pp to U.S. inflation in 2027.
The bank sees an 81% chance of a super El Niño persisting into 2027, which could lift food inflation to 5% and headline inflation by 0.6 pp with Iran-war oil spikes.
Emerging markets such as India, Indonesia, Brazil and Colombia are most exposed, while Europe and the United States face food impacts but energy-driven price pressure.

History

Historical Context

In October 1973 OAPEC, led by Saudi Arabia and Iran, embargoed the United States and other Israel-supporting nations, pushing crude from $3 to nearly $12 per barrel—a 300 % jump by early 1974. The shock sparked global inflation and showed how energy volatility can embed price expectations. JPMorgan now warns a super El Niño could raise 2027 U.S. inflation by 0.3 percentage points.

1 of 2

Story summary

JPMorgan warned that an El Niño and energy prices could add 0.3 pp to U.S. inflation in 2027.
The bank sees an 81% chance of a super El Niño persisting into 2027, which could lift food inflation to 5% and headline inflation by 0.6 pp with Iran-war oil spikes.
Emerging markets such as India, Indonesia, Brazil and Colombia are most exposed, while Europe and the United States face food impacts but energy-driven price pressure.

1 / 2