New Delhi, March 21 -- Global financial markets are expected to remain influenced by the ongoing conflict in West Asia, with risk aversion likely to persist amid rising uncertainty, according to a report by ICICI Bank.

The report said that "markets are expected to continue to get shaped by the ongoing conflict in the Middle East that has so far not shown signs of de-escalating," adding that "risk aversion is expected to remain in place."

According to the report, prior to the conflict, the base-case scenario assumed that "the tariff pass through would start to fade and that would push US inflation gradually lower and labour markets would remain weak that could open scope for a 50bps cumulative cut over 2H2026."

However, the report cauti...