Global Economic Consequence of Russian Invasion of Ukraine

34 Pages Posted: 20 Apr 2022 Last revised: 13 Feb 2023

Date Written: 2022


This paper explores the global economic consequence of the Russian-Ukraine war in the month of invasion. Russia invaded Ukraine on the 24th of February 2022. As a result of the Russia-Ukraine war, multiple international sanctions were imposed on Russia to compel Russia to de-escalate the crisis. The sanctions imposed on Russia, although intended to hurt Russia, had spillover effects to the global economy mainly through global supply chain disruption. Using global data and data from the Euro Area, Ukraine and Russia, the findings show that there was an increase in the global PMI and an increase in the world price of food and food ingredients. The index of global stock markets plunged on the day of invasion. The Euro Area manufacturing purchasing managers’ index (PMI) declined in the month of the invasion. Also, the transportation component of the consumer price index rose in the month of the invasion due to shortage of energy and fuel supplies which led to a rise in the price of gasoline for transportation in the Euro Area. Ukraine experienced a more devastating effect from the invasion than Russia and the entire Euro Area. Core consumer prices in Ukraine and the Euro Area were highly correlated during the invasion. Food inflation was highly correlated in the Euro Area and in Russia. Also, there is a positive and high correlation between world food price index, world oils price index, world diary price index and world cereals price index during the month of the invasion. The conflict led to a global rise in prices leading to a rise in global inflation. Although conflict resolution between Russia and Ukraine was brokered by Israel, the economic effect of the crisis still lingered on in many parts of Europe and beyond Europe.

Keywords: War, Ukraine, Russia, conflict, sanction, SWIFT, invasion, economic consequence, NATO

JEL Classification: H56, N44, D74, F51

Suggested Citation

Ozili, Peterson K, Global Economic Consequence of Russian Invasion of Ukraine (2022). Available at SSRN: or

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