Notes

Ukraine-Russia war latest: Hungary signals 'major shift' in Ukraine funding stance; Russia claims it has taken control of Kharkiv village
Despite warnings from the US and its Nato allies that any invasion by Russia of Ukraine would have "severe economic consequences," Moscow's military build-up on the border continues. The latest data for January 2022 shows that the UK economy is now stronger than it was before the pandemic. Sanctions on Russia are already starting to worsen an acute cost of living crisis in the UK. Average household income is expected to fall a further £1,259 with larger price rises than expected until the end of 2025, according to new estimates. Labour's shadow chief secretary to the Treasury, Pat McFadden, said households were facing "a year of surging inflation, weak earnings growth and tax rises".

Ukraine is known as the "breadbasket of Europe," responsible for a large proportion of the world's wheat. The COP talks are designed to give all countries an equal seat at the table, with anyone able to block progress, although these days few want to be perceived as great disruptors. Leaders including Prime Minister Boris Johnson and Ursula von der Leyen have both called for an accelerated roll-out of clean energy. The German government has brought forward its target for 100% renewable electricity by five years to 2035.


If, contrary to what is reflected in futures prices, energy prices stay at current levels beyond the middle of next year, the UK would face a larger and more persistent increase in the price level and fall in real household incomes. Permanently higher energy prices could deliver an adverse supply shock that reduced potential output in the medium term, which in turn would damage the structural fiscal position. In addition to capturing these impacts on the UK economy forecast, there is a smaller, though significant, impact on the fiscal forecast from lower UK equity prices, which have fallen in the wake of the Russian invasion. Our fiscal forecast captures the direct effect of lower equity prices on capital gains tax on the disposal of financial assets, though we do not assume any indirect wealth effect from lower equity prices on consumption and GDP.

Bank of England
In talks with Sergei Shogiu, Mr Wallace said he urged dialogue to resolve the crisis in eastern Ukraine. A Russian invasion of Ukraine would have "tragic consequences" for both countries, UK Defence Secretary Ben Wallace has warned his counterpart in Moscow. President Biden's virtual meeting with President Putin earlier this week was a start and will be followed up by more talks with other Nato members.


He said the security situation in Europe was without precedent since the fall of the Iron Curtain. "Added to that are the recent border crisis involving thousands of migrants in Belarus, as well as Russia's backing of separatists in the Caucasus and elsewhere," he said. But the official noted there had been a combination of sharp bellicose rhetoric from Moscow, accusations of being provoked by Ukraine and Nato, a lack of transparency, and a worrying track record, including the annexation of Crimea in 2014. The war that erupted in eastern Ukraine in 2014 has already left 14,000 dead and an estimated 1.4 million displaced. "We could have a very large number of refugees, deaths could reasonably be expected to be high as would destruction within Ukraine," he said. Meanwhile, other Western defence sources have expressed concern about an increase in signals intelligence and "chatter" being monitored which could signal Russia's preparedness to invade.

UK sanctions following Russia’s invasion of Ukraine
“A humanitarian crisis is unfolding before our eyes, leaving thousands dead, forcing millions of refugees to flee their homes and threatening an economic recovery that was under way after two years of the pandemic,” she said. But the senior Western intelligence official warned that "military options are highly likely on the table in the Kremlin" if Russia's demands are not satisfied. In response to the invasion, the geopolitical risk index developed by the US Federal Reserve spiked to the highest level since the start of the Iraq war in 2003. But he adds that this disruption is "nothing" compared to the ripple effect from rising energy prices. Mr McFadden also said the government "must look again at Labour's proposal for a one-off windfall tax on oil and gas producers to cut household energy bills by up to £600". The UK government is providing a range of economic, humanitarian and defensive military assistance to Ukraine, and is imposing additional sanctions on Russia and Belarus.


The Bank of England raised interest rates again in March to try and moderate rising prices. The CEBR predicts that inflation will now peak at 8.7% next quarter and then stay twice as high as expected until the second half of 2023. This means a shopping basket that cost £20 a year ago will cost almost £22 in the next few months. He called for the government to halt a planned National Insurance increase in April. "All sectors grew in January with some industries that were hit particularly hard in December now performing well." All in all, the economy was on course to maintain its return to normal after the pandemic.


“Uncertainty is deterring business investment and threatening to curb supply for years to come. At the same time, China’s zero-Covid policy continues to weigh on the global outlook, lowering domestic growth and disrupting global supply chains,” she added. Boone said the OECD had cut its global growth forecast for 2022 from 4.5% to 3%, while inflation in the organisation’s 38 wealthy-country members would average almost 9% – double the forecast in last December’s Economic Outlook.

We will continue to work with Ukraine and our international partners for a just and sustainable peace. According to reports, Russian missiles on Kyiv and Kharkiv killed at least 18 people and injured over one hundred. https://richard-andresen.hubstack.net/media-in-russia-how-do-russians-get-news-about-the-war-in-ukraine-1708116952 was felt most acutely in Kharkiv, where an apartment block was hit, killing two people, and injuring 35 residents.

It's promising to deploy British forces to eastern European members of the Nato military alliance if Russian troops cross Ukraine's borders. Gazprombank, which is part owned by Russian energy giant Gazprom and acts as a key bank for Russia’s energy conglomerates, has so far been excluded from the SWIFT ban. Russia might use the crisis to launch cyber and other hybrid attacks on Nato countries. We have also not made any explicit adjustments for the domestic consequences of international sanctions on Russian financial institutions or individuals, beyond what might be reflected in equity prices in the fiscal forecast. These actions are likely to be felt by individual firms and investors, and potentially some sectors, but their wider impact will not be large relative to, for example, those relating to energy supply.
"I think the whole world has got to recognise that this is not something we've faced before, we are going to see wheat price inflation levels that have never happened," she said. Last week, Boris Johnson, another former prime minister, argued that the re-election of Donald J. Trump to the White House would not be such a bad thing, so long as Mr. Trump comes around on helping Ukraine. “I simply cannot believe that Trump will ditch the Ukrainians,” Mr. Johnson wrote in a Daily Mail column that read like a personal appeal to the candidate. Britain’s economy is forecast to slow to a standstill next year as it suffers more than any other major industrial country from the effects of Russia’s invasion of Ukraine. The Russian president has intensified a crackdown on opposition since the start of his invasion of Ukraine, and this has ramped up further as the elections have approached. Prime Minister Viktor Orban has been highly critical of the EU's financial and military aid for Ukraine and has maintained close ties with Russia.

Some migrants might stay in neighbouring Poland and eastern European countries, but some might head further west and eventually end up in the UK. It's highly likely the election will see him start a new six-year term, which - if completed - would make him Russia's longest-serving ruler since the 18th century. He called for the government to halt a planned National Insurance increase in April. For decades the European Union has heavily relied on Russia's oil and gas, generating money and cash for Russia. Since then, Ukraine's military has been locked in a war with Russian-backed rebels in eastern areas near Russia's borders.
All three lead to higher consumer prices, which will mean a reduction in households’ ‘real’ incomes (that is, adjusted for inflation) and therefore consumption, limiting their economic output (GDP). Ukraine is the world’s second biggest exporter of grains and Russia often tops the ranking for wheat exports. Any disruption to flows would quickly ripple through to buyers globally, raising costs for bread and meat. And while commodity prices tend to be only a small proportion of the price of final food products, UK consumers would be likely to see higher prices on supermarket shelves – this could manifest later this year at a time of already high inflation. Soaring energy costs and supply chain disruption caused by Covid have driven inflation to the highest levels in three decades.


The bounce back in the economy in January was not just stronger than expected, it was also seen in buoyant tax revenues. The economy grew by 0.8% compared with a 0.2% contraction in December the Office for National Statistics said. The UK and our allies condemn the Russian government’s unprovoked and premeditated war against Ukraine. Egypt, China and Turkey import significant portions of these grains and are therefore particularly at risk.

Whatever the medium- or long-term effects of the war it is likely that firms and households around the world, but also in the UK – fearful of the worst-case scenario – will delay investment and consumption decisions, holding back the wider pandemic recovery. Grain prices have also jumped as both Russia and Ukraine are major global producers, particularly of wheat. Ben Wallace's trip to Moscow does not signal any significant shift in the balance of this crisis. As well as driving up costs for energy intensive companies, western sanctions on Russia could hit the availability of materials used in the aerospace, automotive and electronics industries.
After 2,000 anti-tank weapons were delivered last week and 30 British troops arrived to teach Ukrainian forces how to use them, the phrase "God Save the Queen" began trending on Twitter in Ukraine. Some bars and restaurants in Kyiv were offering free drinks to anyone who had a UK passport. But his remark lives on as a challenge to all policymakers thinking about whether to engage diplomatically - and even militarily - in a potential conflict between two foreign countries. It's promising to deploy British forces to eastern European members of the Nato military alliance if Russian troops cross Ukraine's borders. After its botched start, Homes for Ukraine has been an effective model for accommodating large numbers of refugees (more than 110,000 as of January 2023) while defusing the political tension that characterises other asylum policy.

My Website: https://richard-andresen.hubstack.net/media-in-russia-how-do-russians-get-news-about-the-war-in-ukraine-1708116952