Ukraine, Russia, FED discussed on Morning Edition


Com From marketplace I'm so Raven ashore in for David Bronco Russia's invasion of Ukraine is making the job of the U.S. Central Bank a lot tougher Top federal reserves reserve officials are set to meet next month They're going to decide whether to raise interest rates to fight inflation Now they have to factor in the invasion Marketplace is Nancy Marshall joins me now to talk about a morning Nancy Good morning So why would the crisis in Ukraine affect the Federal Reserve It's putting pressure on oil prices since Russia is a big oil supplier And Russia is also a major producer of metals so those prices also went up and sabri this just adds to the inflation the fed is trying to tame The fed might also have to deal with the situation called stagflation where you have higher prices but slowing economic growth How can might that complicate things Well the fed doesn't want to raise interest rates so much that it tips the economy into a recession and stagflation just increases that risk at Diane swank the chief economist at grant Thornton remembers what it was like in the 1970s when super high oil prices collided with rising employment It was the worst of all worlds of people losing their jobs or the economy stagnating as inflation continued to march higher So losing purchasing power as well And that's why it's something we worry about so much Have fed officials said anything about this Not directly Fed governor Christopher Waller did say walder did say yesterday he'd still be open to raising interest rates by a half percentage point when they meet next month although he did say he'd keep his eye on the economic data Other fed officials were more cautious saying they were open to a smaller rate hike All right marketplace doesn't need some commercial guns Thank you You're welcome Ukraine's military has shut down commercial shipping at its ports which are located along the northern edge of the Black Sea This comes after reports Russia suspended commercial shipping traffic along Ukraine's easternmost coast The Black Sea region is a major trading hub for both Russia and Ukraine marketplace is Justin Ho has more on how the conflict is disrupting trade routes there Russia and Ukraine's ports on the Black Sea are big export hubs for wheat corn and crude oil that gets loaded from pipelines and on the ships A lot of fertilizer coming out of the Black Sea is a big ammonia producer which is used in fertilizer production Vivek srivastava is senior trade analyst at vessels value And there's a lot of things I still product produced in the Black Sea region Traverse says Black Sea trade has been slowing down over the past few weeks Now that Russia has invaded Ukraine we might well see refusing to send their ships into the vaccine region Trade in the Black Sea could be disrupted further If Russia decides to blockade Ukrainian ports and it would further isolate Ukraine It says Rachel Brewster a professor at duke law school You know blockading the ports could lead to major shortages within Ukraine That's because Brewster says a blockade would make it harder for aid to get into the country I'm Justin Ho for marketplace Volatility on markets continues the Dow S&P and NASDAQ indexes indices all ended in positive territory yesterday after plummeting at first when Russia started its invasion The NASDAQ finished Thursday up 3.3% after falling by as much as three and a half percent earlier in the day Let's see how things are shaping up this morning.

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