The Russian invasion of Ukraine is going to hit you in the wallet, impacting us in a variety of ways.
Russia is the 11th largest economy in the world and with sanctions coming down from countries around the world the economic ripple will affect all of us. UNOH economics professor Brandon Miller says the reduction of commodities like natural gas and metals will likely drive up prices. And with Russia providing 10% of crude oil supply in the world, higher prices will start for us at the gas pump.
"I've seen estimates out there, initially unleaded prices maybe 30 to 60 cents, you know, but depending on how long the conflict lasts, that could definitely change and so those increased commodity prices are the biggest impact we'll see, which leads obviously to higher gas prices for you and I," explained Brandon Miller, UNOH economics professor. "I think, you know, with those price increases it just leads to further inflation in the economy along with the supply chain problems that we've already been having, these new sanctions will add to those supply chain issues which likely increases inflation further."
Miller adds that the federal reserve will have big decisions ahead. If the crisis increases inflation they will have to target higher interest rates and retirement funds. Stocks and Wall Street could all take a negative hit.
"Financial markets are very unsure right now. They don't know how long the conflict's going to be, they don't know what countries will do as far as sanctions go and so returns on investments will likely be flatter, a little bit lower than expected right now too, again it all depends on further economic sanctions, what Russia decides to do, and how countries around the world decide to react," added Miller.
All of this coming at a time when the United States, the economy, and much of the world are trying to rebuild amid the pandemic and the situation could throw a big wrench in the progress.
