Russian invasion of Ukraine, geopolitical risk, and global financial markets

18 Pages Posted: 6 May 2022 Last revised: 8 Aug 2023

See all articles by Ashrafee T Hossain

Ashrafee T Hossain

Memorial University of Newfoundland (MNU) - Faculty of Business Administration

Abdullah-Al Masum

Johnson C. Smith University

Date Written: March 14, 2022

Abstract

Using daily data from 39 different economies, we provide evidence that Russian invasion of Ukraine negatively impacted the global financial markets. Our study has three major takeaways. First, the event increases overall market volatilities, and the escalated daily geopolitical risk (GPRD) helps explain the variations. Second, the GPRD, particularly during the post-invasion week, drives the global stock indices to decline and global currencies to depreciate against the US dollar. Third, the Euro-zone countries are severely affected by the invasion compared to the rest of the world, understandably due to their geographical proximity, ideological distance, and higher energy dependence on Russia.

Suggested Citation

Hossain, Ashrafee T and Masum, Abdullah Al, Russian invasion of Ukraine, geopolitical risk, and global financial markets (March 14, 2022). Available at SSRN: https://ssrn.com/abstract=4056137 or http://dx.doi.org/10.2139/ssrn.4056137

Ashrafee T Hossain (Contact Author)

Memorial University of Newfoundland (MNU) - Faculty of Business Administration ( email )

St. John's, Newfoundland A1B 3X5
Canada

Abdullah Al Masum

Johnson C. Smith University ( email )

100 Beatties Ford Road
Charlotte, NC 28216
United States

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