Finance
Citi's Surprise Index Shows Longest Upside Run Since Financial Crisis, Awaits War Impact
Published by Global Banking & Finance Review®
Posted on March 19, 2026
3 min readLast updated: March 19, 2026
Quick Summary
Citi’s global economic surprise index has marked 14 straight months of positive readings—the longest such streak since the 2008–09 financial crisis—and is poised to become the second-longest ever. This resilience comes despite rising geopolitical risks, notably the Iran war’s impact on energy and in
Citi's Economic Surprise Index Marks Longest Upside Run Since Financial Crisis
Global Economic Growth Outpaces Expectations Amid Geopolitical Uncertainty
By Alun John and Dhara Ranasinghe
LONDON, March 19 (Reuters) - Global economic growth has continued to outperform expectations for 14 straight months — just as the war in Iran fuels fresh concerns about energy prices and global stability — putting the world economy on track for its longest run of upside surprises since the 2008-09 financial crisis.
Citi's Economic Surprise Metric Explained
Citi's popular economic surprise metric, which measures how economic data in the prior three months differs from consensus forecasts, has been in positive territory since January 2025, suggesting that economists overestimated hits from geopolitical turmoil and U.S. tariff hikes.
On Thursday it is set to overtake its post-Covid-19 streak, making this its second longest on record, behind the 2009-2011 period.
Impact of Recent Geopolitical Events
The index does not yet reflect the impact of the war in the Middle East, which has pushed oil prices up and renewed growth worries and will take time to feed into economic data.
Expert Insights on Economic Surprises
"There is no reason for it to be consistently positive, surprises are normally pretty random, and expectations should adjust to past surprises," said Kristjan Kasikov, global head of Citi FX Quant Investor Solutions.
"The fact that this has not happened over the past year, means economists have been too stubborn in not adjusting their expectations for better than expected growth," said Kasikov, who created the index 20 years ago.
"They expected the fallout from trade uncertainty and geopolitics to weigh on growth, and that did not happen."
He said export and industrial production figures had been particular contributors to the outperformance.
Key Drivers of Economic Outperformance
Tariffs and Trade Policy
U.S. President Donald Trump announced a series of tariffs on U.S. imports early in 2025. While they have been reduced from the highest levels, which shocked markets when they were announced in April, they remain relatively high.
Investment and Fiscal Policy
Massive investment in artificial intelligence and an expansionary fiscal policy from many governments have bolstered growth.
Risks and Outlook
Potential Impact of Rising Oil Prices
Still, analysts expect the oil price surge to weigh in the months ahead, especially if higher costs spark a broader surge in inflation and force central banks to raise interest rates.
Growth Trends and Market Performance
Kasikov said for most of 2025 data showed global growth was decelerating, but by less than economists had expected. In the fourth quarter this shifted and growth indicators began to accelerate, and by more than expectations.
He also said this could explain why global equities performed well in 2025.
MSCI Index Performance
The MSCI all country world index rose 20.6% last year.
(Reporting by Alun John and Dhara RanasingheEditing by Ros Russell)
Key Takeaways
- •Citi’s economic surprise index has remained positive since January 2025, signifying 14 straight months of data outperforming forecasts—the longest streak since the 2008–09 financial crisis and now on track to be the second-longest ever. (occ.treas.gov)
- •The current run highlights that economists were too pessimistic in forecasting negative growth impacts from geopolitical tensions and U.S. tariffs, with strong export and industrial data driving the outperformance. (occ.treas.gov)
- •However, the index doesn’t yet factor in the latest Iran war escalation, which could raise energy costs and inflation, potentially reversing the trend and challenging expectations in the months ahead. (citigroup.com)
References
Frequently Asked Questions about Citi's surprise index shows longest upside run since financial crisis, awaits war impact
1What is Citi's economic surprise index?
Citi's economic surprise index measures how recent economic data compares to consensus forecasts, indicating whether outcomes are better or worse than expected.
2How long has the Citi surprise index remained positive?
The index has been in positive territory for 14 consecutive months, its longest streak since the 2008-09 financial crisis.
3What factors are driving the economic outperformance?
Export and industrial production figures, massive investment in AI, and expansionary fiscal policies have contributed to the stronger-than-expected global growth.
4How might the war in the Middle East affect the index?
The impact of the Middle East war, especially rising oil prices, is not yet reflected in the data but could weigh on future growth and surprise readings.
5Why have economists underestimated global economic growth?
Economists overestimated the negative impact of trade uncertainty and geopolitical tensions, failing to adjust expectations as growth outperformed forecasts.
