Goldman Sachs CEO Says Markets Are Too Calm in the Face of Middle East Conflict

Goldman Sachs chief executive David Solomon has said the financial markets have reacted relatively calmly to the conflict in the Middle East, admitting he was surprised by the muted response given the scale of the crisis. ‘I look at the market reaction, and I’m actually surprised that the market reaction has been milder than you might think given the size of this conflict,’ Solomon said in a speech at a business forum in Sydney on Wednesday, 4 March 2026. He noted markets usually do not react strongly to geopolitical events unless the impact is directly felt on economic growth. ‘There is a cumulative effect from everything that is happening and the reaction will be far harsher. So far, we have not seen that cumulative effect,’ he said. ‘But it is very hard to speculate because there are so many things we do not yet know.’ ‘I think it will take a few weeks for markets to truly digest the implications of what has happened, both in the short and medium term, and I cannot speculate on how that will unfold,’ he added. Since the conflict widened, oil prices have surged amid fears of supply disruptions. This spike adds to global inflation pressures. Global stock indices weakened briefly. Investors dumped risk assets and moved into instruments considered safer. This shift helped push up the US dollar. The pressure on Wall Street has been modest. The S&P 500 fell by less than 1 per cent over the week after trimming losses at the close. ‘Let us set aside what is happening in the Middle East for now,’ he said. ‘We have a combination of strong macro factors that, in my view, make the path of US economic growth quite attractive.’ Market participants are still weighing near-term risks of the conflict to energy prices and inflation. The direction of future policy interest rates remains a focus.