Russia and Ukraine

Decades of work have been put into building Russia’s financial system. Putin’s war is destroying it overnight.

Russians could try to use cryptocurrencies to dodge sanctions following the invasion of Ukraine, but a move into the mainstream by crypto exchange heads hungry for fiat currency wealth will complicate evasion tactics.

In the raging crisis between Russia and Ukraine, fixed income bankers picking over a disrupted new issuance market are finding echoes of the start of the coronavirus pandemic. But they warn that the conflict is only worsening inflation concerns – and that central banks are in a bigger bind than ever.

For Putin, the threat of expulsion from Swift carries far less weight than it did in 2014. Russia’s own system for transfer of financial messages can now settle domestic transactions, but the move would still trigger a deep recession in the country.

Russia’s incursion dispels vain hopes of manageable tail risk and heralds a bear market correction.

Energy price volatility driven by war in Ukraine could deliver a windfall to banks such as Goldman Sachs that retain scale in commodity trading. Profits from dealing can also be made without triggering ESG or sanctions-related pain.

A year ago, Sber’s stellar profitability looked to be under threat. This year, it has defied the doubters and has just unveiled record net profit for the first nine months of the year.

Policymakers in Moscow are finally promising to tackle climate change. Will the Russian private sector follow suit?

Low interest rates, lockdown boredom and super-sophisticated trading apps have lured millions of Russian retail investors into the capital markets over the past year. But will they stay for the long term?

If the current geopolitical tensions escalate into military action, even the most hardened foreign investors might start looking for an exit from Russia.

Emerging markets have regained some of the buoyancy lost during the early months of the coronavirus crisis, but analyst opinions hint at the difficulty of identifying which EM currencies investors should favour.

Russia’s big state bank wants to be the leading player in the country’s fast-growing e-commerce sector. It could succeed.