And It Begins

The day that was warned by the Biden Administration for the past 2 weeks came. Ukrainian Foreign Minister Dmytro Kuleba said earlier "Putin has just launched a full-scale invasion of Ukraine. Peaceful Ukrainian cities are under strikes,".


This comes directly after the Russian forces fired hundreds of missiles towards Ukrainian cities and military bases.


This attack will be known as the special military operation in the east as stated by the Russian president earlier today in a televised announcement.


Joe Biden, the U.S. President said that they have been trying to warn people that such movements will occur and that the U.S. will give total support to the Ukrainian people, even if in an indirect approach. "as they suffer an unprovoked and unjustified attack by Russian military forces".


The main issue goes back to when Putin demanded an end to NATO's eastward expansion. However, the main issue as stated by Putin seems to be against the direct influent of the United States on the decisions made by NATO.


All of that had direct and sudden effects on the markets, whereby global indices tumbled.


The Russian Rouble his record lows reaching RUB89.98 per dollar, after investors mainly started investing in safe-haven investments and in specific the safe-haven currencies, such as the U.S. Dollar.

Brent Crude Oil prices (Figure 1) broke above 100 Dollars per barrel testing levels not reached for over 8 years, which doesn’t come as surprise given the current invasion.


Figure 1: MetaTrader 4, CFI UKOIL


Gold Prices on another hand increased more than 40 dollars per ounce amid risk-averse investments targeting safe haven territory.


Figure 2: MetaTrader 4, CFI, XAUUSD


Worth noting that the attention should not only be on the current situation, It should also be on the inflation rate forecasts in the U.S.


The Federal Reserve and the Biden Administration have a really tough decision to make in the upcoming months, especially since oil prices are increasing in a faster manner, triggering further increases in commodity prices.


With the current losses incurred in major U.S. indices, can the economy handle rate hikes, which in return will also trigger indices lower?


Click here to find out more.


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