Inflation was doubtless the main macroeconomic challenge afflicting the GCC countries in 2007-2008. Since then, the situation has generally improved and the past year has seen a fairly consistent easing of inflationary pressures, a trend that clearly accelerated in the spring.

The main reason for this has been the mounting anxiety about the global economy. With the euro zone teetering on the edge of the precipice and growth prospects even for the leading emerging markets in some doubt, the positive commodity price momentum of recent years has stalled and reversed.

At the same time, there has been a relative retreat from the kinds of unconventional stimulus measures that tend to support asset prices. We have seen relative stability rather than major new initiatives on the quantitative easing front, for instance.

Moreover, with the exception of periodic upward pressures for oil, there have not been major supply chain disruptions that would have pushed up prices.

Now, however, this period of calm may be coming to an end. As so many times in the past, the main source of pressure is coming from the commodity front, specifically grain prices.

What has transformed the situation is a sharp deterioration in the weather conditions in North America were some two-thirds of the continental US has been hit by a major drought, the worst since the 1950s. Over 80 percent of the country is considered abnormally dry.

Consequently, especially the corn harvest is looking likely to fall far short of the bumper crop predicted only weeks ago. This in spite of the fact that acreage devoted to corn cultivation — 96.4 million — was the highest since 1937. Close to 40 percent of the corn crop is now considered to be in poor condition as opposed to just over 10 percent a year ago. The weather patterns are not expected to change before the end of the month.

The US Department of Agriculture recently warned that food prices would continue to increase into 2013. Also Russia has warned of a disappointing harvest while the Indian monsoon season has fallen far short of the norm with a very poor start in June.

One of the greatest risks in the current situation — in an uncomfortable echo of what happened in 2008 — is that key producer nations facing price pressures will react to them through protectionist measures. For instance, India has experienced chronic food price inflation in recent years with adverse implications for the millions living near or below the poverty line.

An estimated 75 percent of Indians subsist on less than $ 2 a day. If the supply situation were to suddenly deteriorate, the political pressures for protectionist measures might rapidly mount. This could dramatically curb the tradable surplus in agricultural commodities and further increase the pressure on prices. Thankfully, historically plentiful grain reserves should provide something of a buffer in India.

Although some GCC countries have benefited from the relative absence of rental price pressures because of excess supply or downright property market corrections, rentals have been among the factors keeping inflation at a historically elevated level around the 5 percent mark in Saudi Arabia.

Recent increases in government spending have further contributed to price pressures in parts of the region, although also this effect seems to be waning. But there now, just as inflation was becoming less of a preoccupation, there is a growing chance that food prices will prove the next complication. Not only do the dollar pegs limit the room for a monetary policy response, but also monetary tightening in the face of what is genuinely a supply shock would probably prove counterproductive anyway. Should the pessimistic harvest projections indeed materialize, keeping global trade flowing will once again become one of the main challenges facing policy makers around the world.