Economist and co-founder of Echelon Wealth Partners, Peter Schiff said that President Donald Trump cannot afford for the Iran war to end if inflation remains elevated, claiming the conflict provides a convenient explanation for rising prices ahead of the midterm elections.
Calling the conflict a “perfect scapegoat,” Schiff argued that Trump can blame rising prices on the war while maintaining hopes that inflation will ease once the conflict ends.
Why The Iran Conflict Matters For Inflation
The conflict, which began in February, intensified on Monday when Iran launched missiles at Israel in retaliation for Israeli strikes near Beirut, its first direct attack since the April 8 ceasefire, reigniting fears of broader regional escalation.
The latest escalation comes as diplomatic efforts to restore a ceasefire and reduce tensions remain underway, with negotiators seeking to prevent a wider regional conflict.
Speaking to Axios, Trump said he would urge Israeli Prime Minister Benjamin Netanyahu against launching another round of strikes, arguing that both sides have already exchanged attacks and that diplomacy should now take precedence.
However, the Israeli military said the Israeli Air Force struck military targets belonging to the Iranian regime in western and central Iran.
The latest developments will likely renew concerns that escalating tensions could push oil prices even higher, further increasing costs for businesses and consumers.
Schiff argued that the war allows Trump to “blame rising prices on the war” while maintaining hopes that inflation will ease once the conflict ends.
Schiff Says Inflation May Outlast The Iran Conflict
Schiff argued that an end to the conflict would not necessarily bring lower prices, contending that the war has become a convenient explanation for inflation rather than its primary cause.
He said Trump can offer voters “false hope” that prices will “come crashing down” once the fighting ends, even if broader inflationary pressures remain intact.
What Happens If Prices Stay High After The War?
Schiff argued that the political value of the conflict lies in its ability to serve as an explanation for higher prices, particularly as inflation remains a concern for voters heading into the midterm elections in November this year.
Inflation remains a key political issue ahead of the midterms, with U.S. consumer prices rising 3.8% year-over-year in April, marking the fastest pace of inflation since 2023.
The economist suggested that if inflation remains elevated after the war ends, scrutiny could shift toward other factors contributing to higher prices.
“He can’t risk ending the war and prices staying high,” Schiff said.
The remarks reflect Schiff’s broader view that geopolitical events are being used to explain inflation that has deeper economic roots.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Image via Shutterstock/ noamgalai
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