By Balazs Koranyi and Francesco Canepa FRANKFURT (Reuters) -Tariffs will weigh on euro zone economic growth and prices for years, but there is little risk of inflation falling too low, and even the euro's surge against the dollar is not a major worry,

The Indian Rupee (INR) posts a fresh two-month low, slightly above 86.20 against the US Dollar (USD) at the start of the week. The USD/INR pair faces selling pressure as the US Dollar ticks up amid an increase in its safe-haven demand, following the conflict between Israel and Iran.

Friday's selloff in U.S. government debt, sparked by inflation concerns stemming from the escalating conflict between Israel and Iran, sent Treasury yields up by the most in one week as oil prices surged.

Israel’s attacks on Iran’s nuclear facilities risk pushing back the timeline for Federal Reserve interest-rate cuts as the US central bank waits to assess any potential impact on inflation, economists said.

Oil-watchers are bracing for a further price rally after Israeli strikes on Iranian energy assets heightened the risk to Middle East supplies. Follow live.

A sustained rise in the price of crude oil, which jumped sharply after Israel attacked Iran, could hurt consumers and President Trump’s efforts to bring down energy costs.

The global oil market is back in chaos after Israel launched military strikes against Iran on Friday. The move pushed crude oil prices up 8% to $74 a barrel

The Federal Reserve is widely expected to hold interest rates steady next week, with investors focused on new central bank projections that will show how much weight policymakers are putting on recent soft data and how much risk they attach to unresolved trade and budget issues and an intensifying conflict in the Middle East.

Keep an eye out for signs of labor-market weakness, as well as the risk that rising oil prices could put more upward pressure on inflation.