China’s shipment of garments and accessories increased **.* per cent year on year to $**.*** billion from $**.*** billion, driven by steady demand from key markets such as the US and EU, where retailers have begun restocking after cautious inventory management in ****. Meanwhile, exports of textile products, including yarns, fabrics and related articles, rose at a faster pace of **.* per cent to $**.*** billion from $**.*** billion, supported by stronger downstream manufacturing activity across Asia and improved order flows from emerging sourcing hubs.

In February **** alone, exports of textile yarns, fabrics and related articles were valued at $**.*** billion, while garment shipments stood at $**.*** billion, taking the combined monthly total to $**.*** billion. The relatively balanced contribution of textiles and apparel highlights a synchronised recovery across the value chain, from raw materials to finished goods.

A prolonged Middle East conflict could create new credit challenges for developed countries in Europe and Asia, primarily through higher energy and borrowing costs, rising inflation and weaker economic growth, according to Fitch Ratings.

Fiscal support measures to cushion households and firms could weigh on budget deficit and government debt trajectories, while financing conditions could become less favourable if risk sentiment deteriorates, it noted.

A prolonged Iran war could create new credit challenges for developed countries in Europe and Asia, Fitch Ratings said.
Fiscal support measures could weigh on budget deficit and government debt trajectories, while financing conditions may turn less favourable.
Sovereigns with higher debt and structural deficits, and those facing worse inflation-growth trade-offs, are more prone to a longer shock, it said.

Sovereigns with higher debt and structural deficits, and those facing worse inflation-growth trade-offs, are more vulnerable to a sustained shock, it said.

Higher-than-expected oil and gas prices, feeding into higher inflation, would be the most direct channel of contagion, with spillover effects for real incomes and domestic demand.

“Our baseline is that Brent oil prices remain close to current levels through March, before easing to average $70 a barrel (bbl) for 2026. A simulation using the Oxford Economics Global Economic Model suggests that an alternative scenario of oil at $95-$100/bbl for the whole of 2026 would slow growth across DMs [developed markets], potentially bringing some countries close to recession,” it said in a release.

“Our simulation suggests that inflation risks are most acute in Italy, the UK, Japan and France among the large DMs, given their energy supply composition. The adverse economic growth impact is greatest for Korea, Japan, the UK and Italy, reflecting a larger hit to household consumption as higher energy and transport costs erode real incomes,” it noted.

Among smaller DMs, the growth impact varies more widely, with the greatest effects in parts of central and eastern Europe, including the Baltic states and Slovenia, as well as Taiwan.

In Western Europe, Norway is the only country that is insulated, reflecting its energy-exporter position and stronger terms of trade under higher hydrocarbon prices.

Monetary policy responses will depend on the balance between higher inflation and weaker activity.

Under Fitch Ratings’ alternative higher oil price scenario, central banks’ willingness to raise interest rates to curb energy-led inflation effects would be constrained by the weaker demand and employment outlook. Consequently, rate paths may not differ dramatically from the current baseline, it added.

Fibre2Fashion News Desk (DS)

The US apparel import market—already compressed to $**.** billion in **** from its $*** billion peak in ****—is now absorbing the most severe logistics and energy shock since the pandemic. Sixteen days into the US-Israel-Iran war, the Strait of Hormuz remains effectively closed to commercial shipping, the Red Sea corridor has been shut down by resumed Houthi attacks, and Brent crude has breached $*** per barrel for the first time since ****. For an industry where more than ** per cent of clothing sold in America is imported, and where tariffs had already driven China’s share from **.* per cent to **.* per cent in four years, this war-driven supply chain rupture arrives at the worst possible moment.

Container freight rates from Asia have surged **–** per cent since February **, emergency war surcharges of $***–$*,*** per container are being levied by all major carriers, and polyester fibre costs are climbing **–** per cent as the petrochemical chain absorbs crude price shocks.