New data suggested the Iran war was pushing Europe into a toxic mix of low growth and high inflation.

The eurozone grew just 0.1% in the first quarter, while inflation accelerated to 3%, and falling consumer sentiment hints at collapsing demand. It may be “the early stages of a stagflationary shock,” HSBC warned in a note.

Germany — already grappling with poor growth — expects to borrow a record €200 billion next year, its finance minister said, as the “irresponsible war … affects our economic development.”

Berlin has been outspoken about the war: Chancellor Friedrich Merz said Iran had “humiliated” Washington, a comment which apparently led President Donald Trump to threaten to withdraw US troops from Germany.