An Iranian analyst and founder of the Vantage finance and investment academy believes that Russia’s invasion of Ukraine will make a major change to the global economy and investing ecosystem by affecting the world’s macroeconomic relations in the coming years.
AmirReza Hassani believes there is no such Exclusive event since Second World War and has a Significance effect that economic-political history dimensions of the modern world can be divided into before and after This event.
He referred to this issue that Western policymakers will never look to Russia as a reliable trading partner as before, which leads to the economic approaches and attitudes of the modern world following no Russia policy in the large transactions and management of the world will change completely, especially in the Western Hemisphere.
According to Amir Reza Hassani, in the short-term politicians and major economies will attempt to search for more reliable energy sources from other parts of the world as soon as possible, especially to accelerate the process of developing alternative energy to “self-reliance” factors and shift economic power industry as soon as possible.
According to the founder of the Vantage finance and investment academy, while the world was repairing the damage caused by the Corona epidemic and optimizing macroeconomic processes, Russia’s invasion changed the world’s economic vulnerability once again in two ways. The first aspect of this damage was the disruption of the supply of strategic goods in the field of energy by Russia, which is being reduced day by day due to the war and the extensive sanctions of the Western bloc. The second aspect of this vulnerability was the impossibility of exporting some basic goods by Ukraine due to the war, which cut off exports of these products and increased inflation in countries around the world.
Amir Reza Hassani predicts that this situation will naturally lead to a rapid increase in inflation and slowing economic growth and decline of macroeconomic indicators in countries around the world and creation of irregularities in global commodity and energy supply systems and a significant crisis for major industries of the world.
“Inflation was high in most of the world’s leading economies even before the Russia-Ukraine war, due to the pressures of the Corona epidemic,” said Hassani. “The US Consumer Price Index (CPI), in other words, the most accurate measure of inflation, reached its highest level in 40 years in February at Seven tenths and Nine-tenths percent.” But Russia’s invasion of Ukraine has also boosted inflation in some European countries, with France being one of the most prominent examples, which has even challenged the political future of Emmanuel Macron.
Amir Reza Hassani, economist, and global financial markets analyst identifies four determinants of stagflation in the global economy, including High food and energy prices, lack of supply or disruption of supply chain and flow of orders, reduced consumption, and economic investment, and ultimately reduced consumer and business confidence. All of these reasons seem to disrupt the current economic and psychological state of the world.
Amir Reza Hassani, in his long-term forecast of the global economic situation, says: Inflation is set to reach its peak in the coming months, and then the recession will begin gradually, as global conditions stabilize and new supply mechanisms take shape. Therefore, considering the set of conditions and macro-influential factors, we forecast the growth of the global economy for 2022 at about 3%, which is assumed to return to normal conditions in the post-Corona era. However, we will still have a very clear and significant risk of slowing economic growth and rising inflation, especially as tensions and further sanctions continue.
He Specifies that Russia’s invasion and the formation of one of the largest global consensuses in history against this country caused its major economic collapse in addition that Russia can never Obtain global trust again as a Trading partner. It seems that this country, in view of the civilized world as a rebel, will gradually withdraw from the important areas in which it plays. A typical example of this issue was the removal of Russia from Group 8, which took place in the Crimean conflict. While the attack on Ukraine constitutes a violation of the borders of the modern world, it is very different from the Crimean conflict. Owing to this, the world will try to quickly reduce the main roles of Russia in the supply chain and not allow it to repeat once again the current economic turmoil that Russia has encountered.
Amir Reza Hassani suggests that small and large investors turn to this market to reduce their investment risk, and due to increasing commodity prices continuously in any matter with the withdrawal of Russia from the market, the prices of these products will increase. meanwhile, digital currencies (inflation-free) can also be a good alternative.