Ukraine war update: ‘Europe will see the biggest negative impact on growth’

on Mar 3, 2022
  • Kevin Boscher says ECB won't be able to raise rates due to Ukraine war.
  • A brief recap of notable Ukraine-related developments on Thursday.
  • Brent crude jumped to a decade-high of nearly $120 a barrel today.

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Stocks of Russian companies listed on the London Stock Exchange, including Gazprom and Sberbank, tanked sharply on Thursday as the Ukraine war entered its second week, forcing LSE to temporarily terminate trading in Moscow-linked businesses.

Europe to take the brunt of the Ukraine war

The geopolitical tensions fuel uncertainty for the global economy and how central banks will respond to record inflation this year, and Ravenscroft CIO says the brunt of it will fall on Europe. On CNBC’s “Squawk Box Europe”, Kevin Boscher said:

You have this whole uncertainty now over Ukraine. There’s no question that Europe will potentially see the biggest negative impact on growth. The European central bank won’t be able to raise interest rates until it’s made sure there’s plenty of liquidity in the system.

The blue-chip FTSE 100 index is down nearly 3.0% on Thursday as brent crude jumped to about $120 a barrel, painting a rather gruesome picture of what to expect from inflation ahead.

Ukraine war updates: developments on Thursday

Officials from Russia and Ukraine have concluded second round of peace talks without any breakthrough. Both sides, however, agreed to creating humanitarian corridors to safely evacuate civilians, and to another meeting in the coming days.

Meanwhile, Russia continues to penetrate Kyiv, warning citizens for the last time on Thursday to leave the capital, indicating that Putin will soon launch a full-scale assault on the north-central city. Moscow has already taken control of Kherson.

Other cities, including Kharkiv, Maripol, and Enerhodar that makes up a quarter of Ukraine’s power generation are also under heavy shelling as Russian troops try to seize control. President Volodymyr Zelenskyy implored that NATO authorizes a no-fly zone over Ukraine that European Council President Charles Michel says would be “one step too far”.