How will Russia’s invasion of Ukraine affect global markets?

The crisis in Ukraine is having a profound effect on the Russian economy and global markets.
The main economic consequences of the Russian invasion of Ukraine are higher energy and commodity prices, slower economic growth and turbulence in global financial markets.

A major impact of the invasion is an outflow of capital from Russia, which could lead to a financial crisis.
Russia’s invasion of Ukraine has caused commodity prices to soar.

In an interconnected global economy, the war in Ukraine has an antagonistic effect on economies around the world.
The war in Ukraine has damaged its economy, which was already poor due to mismanagement by previous governments.
Ukraine has a GDP of $3,500 per capita compared to $11,000 for Poland and $33,000 for Germany.
Unemployment before the war started was 7% and 1 million Ukrainians were working in Russia.
The uncertainty surrounding Russia’s actions in Ukraine continues to create volatility in global financial markets and adds another risk factor to an already uncertain global economic outlook.

The real danger to the Ukrainian economy is that Russia will stop supplying natural gas to its neighbor in retaliation for EU sanctions. If this were to happen, it would be a major blow to Ukraine, as Russia currently accounts for nearly 60% of its imports and 30% of its exports.
One of the sanctions being considered is the exclusion of Russia from the Swift network. Swift stands for “Society for Worldwide Interbank Financial Telecommunication”. This network is used to transmit payment orders.
The current conflict between Russia and Ukraine increases the likelihood of economic consequences in both developed and emerging economies. As a result, businesses and government policymakers have begun to formulate strategies to respond to any economic crisis that may result from prolonged political instability.

The central question remains: how long will the West sit back and watch events unfold in Ukraine before intervening directly? It seems only a matter of time before such action is taken, as some of the most powerful Western countries strongly condemn Putin’s actions and have already mobilized their troops to go to Ukraine.