Russia-Ukraine Conflict Intensifies
President Joe Biden said on Tuesday that Russia’s actions in Ukraine will trigger massive sanctions, a response he has been threatening for weeks as President Vladimir Putin built up troops on Ukraine’s borders. In a speech from the White House, Biden said the Russian leader has committed “a flagrant violation of international law.”
Putin on Tuesday received authorization from lawmakers to use Russian troops outside of the country, a move he said was necessary to formalize the military’s deployment in two rebel regions of eastern Ukraine. Russia recognized those provinces as independent on Monday, and Putin ordered troops there to “maintain peace.”
President Joe Biden described the Russian actions as the beginning of an invasion of Ukraine and said more U.S. sanctions could follow the measures announced Tuesday.
The outcome of Russia’s incursion into two breakaway regions of Ukraine is uncertain, but it has already caused commodities prices to shoot higher.
Economists said it will be the price of oil that could ultimately drive Fed policy. The jump in crude oil prices is first a catalyst for inflation, and eventually, it could become disinflationary if the price goes higher and endures, dampening economic growth.
Biden said he would do everything in his power to insulate American consumers from the cost of Russia’s actions, but he acknowledged that gas prices would likely rise.
“Defending freedom will have costs for us as well, here at home. We need to be honest about that,” he said. But he said the United States was working with other major oil-producing countries on a plan to stabilize prices.
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