On Thursday, 24 February, Russian forces entered neighbouring Ukraine, sparking what some are calling the largest conflict in Europe since World War 2. Land, sea, and air forces have been sent into Ukrainian space, with the country’s foreign minister saying that the country’s capital, Kyiv, has been hit by Russian rocket strikes. While the US equities market initially plunged at the news of the invasion, stocks have rallied by the end of closing. Meanwhile, the price of oil and gold soared, and then dipped at the news. The White House has also warned that the conflict could put a toll on the already-strained supply of semiconductor chips since both Russia and Ukraine are major exporters of materials used in chip production. The move also threatens already-soaring worldwide inflation, with Russia being a significant source of crude oil, natural gas, and wheat. Analysts are now saying that the Fed is less likely to push for an aggressive stance during the upcoming planned rate hike in March.
UK’s “Living with Covid plan” to lift all pandemic restrictions
UK PM Boris Johnson has lifted all remaining Covid restrictions in England as part of the government’s long-term plans for living with Covid-19. The move will remove the need for those that test positive for the virus to self-isolate for 10 days. Free lateral flow tests, which check for Covid-19 in 30 minutes, will also be phased out. Both the opposition and physicians have expressed concerns about Johnson’s plans to “return to normality” amid an 81% vaccination rate among adults.
Germany boosts defence spending by €100 billion
In light of the ongoing conflict in Eastern Europe, German chancellor Olaf Scholz has pledged a €100 billion ($US110 billion) fund for defence spending, calling it Germany’s “historical responsibility” to ensure that Putin does not repeat history. Germany earlier announced that it would be sending military supplies to Ukraine, breaking a post World War 2 pledge that Germany would not be exporting weapons to conflict zones. German defence stocks soared at the news, with listed contractors like sensor producer Hensoldt leaping by 45%. Rheinmetall, which makes armoured vehicles, rose 30%; while shares of submarine producer Thyssenkrupp rose by 8%.