The Iran war and lingering trade tensions could dent euro zone economic growth, push up borrowing costs and challenge some member states' ability to sustain public budgets, a European Central Bank report concluded on Wednesday.
Financial markets have mostly shrugged off the war in Iran, leaving stocks at rich valuations, corporate borrowing costs low and the spread between sovereign bond yields across the 21-nation bloc at low levels, raising fears that investors may be complacent about risks.
