Worldwide Market Reaction To Russian Incursion So Far
As the invasion of Ukraine rages on, worldwide markets respond. Gas prices surge, stock markets plummet in mass sell-off. Russian ruble continues to slide.
Putin’s invasion of Ukraine sparks stock selloff sending stock market plummeting worldwide, and commodities soaring. The Forex market has so far seen a decline in trading volatility. Ruble continues to plummet under the weight of sanctions. European gas soars due to Nord Stream 2 decision. Economists don’t see the changed economic landscape as a threat to the USD.
The broad selloff in stocks accelerated, adding to last week’s losses, as Russia’s invasion of Ukraine injected fresh uncertainty into markets already under pressure from the threat of rising interest rates.
Putin’s invasion of Ukraine is taking its toll on the economic landscape as the effects of crushing sanctions is becoming ever more apparent on the ruble. FX markets experience decreased volatility. One month, for example, traded volatility prices for both EUR/USD and USD/JPY fell around 1% to 6.5%. It is believed that this is going to be the extent of the russian invasion on FX markets.
The key index of Russia’s main stock exchange fell 20 percent after a delayed opening as investors feared the effects of Western sanctions following Moscow’s decision to attack Ukraine.
The ruble crashed more than 9 percent on currency markets, prompting the Russian central bank to intervene to “stabilize” markets.
“To stabilize the situation on the financial market, the Bank of Russia has decided to start interventions in the foreign exchange market,” the central bank said in a statement.
“The Bank of Russia will ensure the maintenance of financial stability and continuity of the operation of financial institutions, using all necessary tools,” it said.
It added that other financial institutions “have clear action plans for any scenario.”
European gas soars due to Nord Stream 2 decision. Natural gas prices rose after Germany’s Chancellor Olaf Scholz stopped progress on the Nord Stream 2 pipeline project that would deliver natural gas directly from Russia to Germany.