Economic growth across regions covered by the European Bank for Reconstruction and Development (EBRD) is set to slow more sharply than previously expected, as rising energy prices linked to the conflict in the Middle East push inflation higher and weaken momentum across emerging markets.

In its latest Regional Economic Prospects report, the EBRD said aggregate growth across its regions is now projected at 3.1% in 2026, down from 3.4% in 2025 and 0.5 percentage points below its earlier February forecast. Growth is expected to recover modestly to 3.6% in 2027, although that too has been revised slightly lower.

The bank, which finances projects across central and eastern Europe, Central Asia, the Middle East and North Africa, said the outlook has been disrupted by surging oil and gas prices, instability in shipping routes through the Strait of Hormuz, and widening energy cost gaps between Europe and the United States.

The EBRD estimated that growth across its economies slowed to 2.9% in the first quarter of 2026, with weaker-than-expected performance recorded in several large markets including Egypt, Kazakhstan, Romania, Turkey and Ukraine.

Chief economist Beata Javorcik said the latest shock has hit already fragile economies. “The conflict in the Middle East has delivered a new shock to regions already navigating weakness in manufacturing industries and fragile fiscal positions,” she said.

Inflation has also reaccelerated after easing late last year. The EBRD reported that average inflation across its regions rose to 6.4% between February and April 2026, an increase of 1.2 percentage points. Higher energy and food costs were identified as the primary drivers, while currency depreciation against the US dollar added further pressure in several economies.

The bank warned that inflation could remain elevated for longer than previously expected, particularly in emerging markets where households spend a larger share of income on food and energy compared with advanced economies.

To cushion the impact, nearly two-thirds of EBRD economies have introduced measures such as fuel price caps, tax relief and targeted subsidies. However, the bank cautioned that these steps are placing additional strain on public finances at a time when borrowing costs are already rising.

Higher energy bills, tighter global financial conditions and elevated debt levels are compounding fiscal pressures across many member countries.

Looking ahead, the EBRD warned that a prolonged conflict could further disrupt supply chains, push energy prices higher and weaken investment flows. Such developments, it said, would weigh on already subdued growth prospects across its regions.

For now, policymakers face a difficult balance between supporting households and maintaining fiscal stability, as external shocks continue to reshape the economic outlook.

Artificial intelligence company Anthropic has taken a significant step toward a public market debut, filing confidential paperwork with US regulators in a move that could see it become the first major generative AI firm to list on Wall Street.

The company confirmed on Monday that it had submitted a draft registration statement to the US Securities and Exchange Commission for a proposed initial public offering of its common stock. Anthropic said the filing allows it to move forward with an IPO once regulatory review is complete, while stressing that timing, valuation and share pricing will depend on market conditions.

The development places Anthropic in a potential lead position over rivals OpenAI and Elon Musk’s xAI-backed ventures, as leading AI companies edge closer to public markets amid intense investor interest in the sector.

“I think we were all expecting OpenAI to go first, so it was a little bit surprising,” said Patrick Corrigan, a law professor at Notre Dame University who studies IPOs. He noted that a near-simultaneous arrival of major AI listings could give investors a direct basis for comparison. “There seems to be a bit of a first-mover’s advantage here,” he added.

Founded in 2021 by former OpenAI researchers, Anthropic has rapidly grown into one of the most valuable private technology firms. The company recently reported raising $65bn in private funding, giving it a valuation of around $965bn. That figure places it ahead of OpenAI’s most recently disclosed valuation of about $852bn following a major fundraising round earlier this year.

Anthropic also said it is now generating an annualised revenue rate of $47bn, driven by growing enterprise demand for its Claude AI models, which are used for coding, content creation and workplace automation. The company released its latest model, Claude Opus 4.8, last week, highlighting improvements in software development and professional applications.

The IPO filing arrives during a broader resurgence in global listing activity. According to KPMG, companies raised $42.6bn through 251 IPOs in the first quarter of 2026, a 45% increase year on year, with investors favouring fewer but larger deals. Analysts say artificial intelligence and space technology firms are expected to dominate upcoming listings.

Industry observers suggest Anthropic’s move could accelerate IPO plans across the AI sector. Wedbush Securities analyst Dan Ives described the development as a potential catalyst for renewed activity in public markets, where technology listings have been subdued in recent years.

However, concerns remain over valuations and profitability across leading AI companies, which continue to invest heavily in computing infrastructure and model development without sustained earnings.

Some analysts compare the current wave of AI enthusiasm to the early internet era, when rapid innovation produced both long-term winners and high-profile failures. While optimism remains strong, questions persist over whether market expectations are running ahead of underlying financial fundamentals.

For now, Anthropic’s filing marks a pivotal moment in the competition among leading AI firms, setting the stage for what could become one of the most closely watched IPO races in recent technology history.