Houthi rebels in Yemen are attacking cargo ships plying the waters connecting Asia with Europe and the United States (US) in a bid to stop Israel’s offensive against Hamas in Gaza. As a result, traffic is being forced away from the Suez Canal and redirected around the tip of Africa.

The disruption is causing delays and driving up costs at a time when economies around the world are already grappling with concerns of resurgent inflationary trends.

The extent to which escalating shipping costs will reflect in consumer prices is still unclear. This is especially in Europe, where weak consumer demand means businesses will face pressure to absorb extra shipping costs.