A week ago in Geneva, the United
States, Russia, Europe and Ukraine struck a deal that was supposed to help
resolve the crisis in the East-West relations. The agreement has unraveled very
quickly. Washington and Moscow are blaming each other for failures that have
lead to violence between government forces and pro-Russian militants to escalate.
As tensions rise, investors are very skeptical with events in Ukraine reaching
far reaching consequences. Three things to keep an eye on include; Western sanctions,
Russian gas and the European economy.
http://money.cnn.com/2014/04/25/investing/russia-ukraine-risks/index.html
This is a good example of how international political affairs can affect domestic economies. Events like this one are bound to hit economies globally, especially FDI.
ReplyDeleteIn the last 48 hours we have seen a lot of movement in this area. First, the US put new sanctions on Russia and prominent Russian officials. Second, the S&P (a bond rating corporation) downgraded Russian bonds to basically a little better than junk. Having poor ratings increases the price of national borrowing, so Russia is going to feel it. And feel it they have: their stock index is down in the gutter. Hopefully, no one was particularly bullish on Russia early this year....
ReplyDelete