War-Safe
With the Russian economy struggling, the impact on the global economy might not be as bad as you expected. To view this, we can look at the largest economy in the world: the United States of America. The US has links to most global economies too, making them an accurate indicator.
Most analysts believe that the US will be able to handle the economic shock caused by the Russia-Ukraine conflict due to the economic strength it flashed in the weeks prior. The service sector is starting to break pre-pandemic levels, which is important as it’s the sector that has lagged the most. The area where the US is most linked with Russia is the energy sector, obviously, and the effects of the war have been displayed. Commodity prices have increased, with oil hitting 100 dollars per barrel. However, economist Mark Zandi expects this to only decrease US growth by 0.2 percent this year, saying that this will lead to marginal cuts in the US economy as opposed to a big economic decline. It’s important to note that Russia’s economy isn’t that large: the state of Texas has a much larger economy, as do nations like South Korea. This presents an opportunity for some investors in the stock market as the S&P 500 is hovering at correction territory, but further escalation of the war could lead to better value in the coming weeks. Most long–term investors love to buy the dip at market corrections or bear markets, so keep the benchmarks of 10 percent and 20 percent in your head!
I am not a financial advisor and my comments should never be taken as financial advice. Investments come with risk, so always do your research and analysis beforehand.
