Bruce Kasman is joined by Natasha Kaneva and Jahangir Aziz to discuss the intensifying Russia-Ukraine conflict and its implication for commodity prices and the global outlook. With Russia moving troops into Ukraine we now believe risk premium will continue to put upward pressure on commodity prices and have raised our forecasts for a number of commodities in which Russia is an important export market. Most notably, we the Brent oil price averaging $115/bbl in 2Q22. There are two sided risks to this forecast. We are not forecasting the imposition of the full range of Western sanctions imposed that could produce large retaliatory action.  At the same time, the rising prospect that Iranian oil comes on to the market could produce lower prices if tensions around Ukraine abate. Rising oil prices is a drag on global growth buts its impact should be tempered by the lifting now underway as the Omicron wave is fading. In all, we do not expect the conflict to give the Fed reason for pause at it is expected to embark on a tightening cycle where we look for moves at each of the next nine meetings.

This podcast was recorded on February 23, 2022.

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