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 Escalating Russia-Ukraine crisis could help the Fed engineer a ADVERTISEMENT

soft landing
 The rapidly escalating tensions between Ukraine and Russia have cast fresh uncertainty on the
Federal Reserve's policy outlook and could force central bank officials to take a more nimble
 approach as they begin raising interest rates for the first time in three years.

 JPMorgan Chase strategist Dubravko Lakos-Bujas wrote in an analyst note to clients this week
that the simmering crisis in Eastern Europe has added to the Fed's slew of worries – including
the hottest inflation in four decades. The conflict could ultimately lead central bank
 policymakers to consider a less hawkish pivot as they prepare for interest rate liftoff.

 LIVE UPDATES: RUSSIA-UKRAINE CONFLICT CONTINUES TO ESCALATE

"Overly restrictive monetary policy could result in an outright policy error especially if the
business cycle continues to deteriorate," Lakos-Bujas wrote in the note. "At the same time, the
Russia/Ukraine crisis could force a reassessment of the Fed tightening path resulting in central
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banks turning less hawkish, while policymakers may consider additional fiscal stimulus."
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military exchanges,
commissaries both home and
abroad

A military vehicle drives on a road as smoke rises from a power plant after shelling outside the
IRS increases 401(k)
town of Schastia, near the eastern Ukraine city of Lugansk, on Feb. 22, 2022, a day after Russia contribution limit for 2022
recognized east Ukraine's separatist republics and order (ARIS MESSINIS/AFP via Getty Images but leaves IRA max
/ Getty Images) unchanged

Although many Wall Street banks and traders expected the Fed to chart a very aggressive
course in normalizing policy due to surging inflation, that outlook has shifted amid the Yellen says Democrats can
heightened tensions in Europe. address debt ceiling via
reconciliation if needed
Although traders still expect the Fed to raise the federal funds rate at its meeting next month,
the appetite for a mega, half-point hike has fallen to 32% from over 94% just last week. Biden administration scales
back IRS bank-monitoring
Russia has amassed an estimated 150,000 troops on three sides of Ukraine, and President plan amid growing pushback
Biden has repeatedly warned that Russian President Vladimir Putin plans to invade the
country. Moscow has repeatedly denied that it is planning to attack Ukraine.
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The analyst note came as Biden on Tuesday afternoon announced a raft of heavy financial Back Better could have
sanctions against Russian banks and oligarchs, accusing Moscow of flagrantly violating 'devastating impact' on labor
shortages and force closures
international law in what he called the "beginning of a Russian invasion of Ukraine." He
pledged to impose more sanctions if Putin continues to escalate the conflict.
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"Let me be clear, these are totally defensive moves on our part," Biden said during a brief White avoid overspending, plus 3
House address. "We have no intention of fighting Russia." ways to get out of credit card
debt

Billionaire Peter Thiel touts

Bitcoin, says he is
'underinvested'

MBA economist says inflation

not transitory: Here’s what
that means for interest rates

Consumer confidence plunges

to lowest level in a decade as
inflation soars higher

Dow posts biggest single-day

drop this year as new COVID-
19 variant triggers market
In this March 3, 2020, file photo, Federal Reserve Chair Jerome Powell speaks during a news sell-off
conference to discuss an announcement from the Federal Open Market Committee in
Washington. (AP Photo/Jacquelyn Martin / AP Newsroom)
Georgia man buys $57,000
Biden joined the European Union in levying harsh sanctions against Moscow: The 27-member Pokemon card with COVID-
bloc of nations also voted to target Russia over its actions in Ukraine, including Germany 19 loan, prosecutors allege
announcing that it would halt the certification of the Nord Stream 2 gas pipeline.

Fed poised to start unwinding

RUSSIA SANCTIONED AFTER PUTIN RECOGNIZES REBEL-HELD PROVINCES IN UKRAINE
pandemic-era policy with
inflation at 30-year high
Russia is the world's second-largest producer of both oil and natural gas; a conflict or sanctions
could disrupt the oil market even further at a time when high demand is outpacing tight
supplies. OPEC and other oil-producing nations, together known as OPEC+, have resisted calls Democrats planning $6T
to boost supply. (Goldman Sachs estimated on Tuesday that oil prices could rise 13.6% in the spending bill that sidesteps
case of an "outright conflict" between the two nations). Republican support

It's unclear how the Federal Reserve will respond to the geopolitical uncertainty – which could
Consumer prices surge 5%
create higher inflation in the short term.
annually, most since August
2008
"The Federal Reserve pays very close attention to geopolitical events, and this one of course in
particular as it’s the most prominent at this point," Michelle Bowman, a Fed governor and a
voting member on the policy-setting FOMC, said on Monday. While she noted the U.S. has Are my mortgage closing
minor banking, financial and trade interests with Russia – which would not have a "significant costs tax-deductible?
impact" on the U.S. economy if a war broke out – she acknowledged there are "potential
impacts" on the energy markets.
Biden says White House must
"Obviously we’ll continue to watch that, and if we believe that might have some influence on tackle rising inflation as
the global economy, we’ll take that into account as we’re going into our meetings and consumer prices surge: 'More
discussing the economy more broadly," she said. to be done'

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