Russia’s attack on Ukraine “will have enormous economic repercussions for the world” resulting in disruptions to the global flow of food and energy, US Treasury Secretary Janet Yellen warned.
“Russia’s invasion disrupted the flow of food for millions of people around the world and caused prices to spike,” the Treasury Secretary said before the House Financial Services Committee. “Russia’s actions represent an unacceptable affront to the rules-based, global order, and will have enormous economic repercussions in Ukraine and beyond”.
The recent sanctions by the Treasury Secretary against Sberbank and Alfa Bank and people close to President Vladimir Putin (including his adult daughters) are not getting the desired echo from European countries since they rely heavily on Russian oil and gas.
“We are witnessing the vulnerability that comes from relying on one fuel source or one trade partner,” she said.
Yellen also said the Treasury Department is committed to holding Russia accountable for its actions and that they should be cut off from the global financial system. Further sanctions from the International Monetary Fund and World Bank are next.
The ongoing conflict along with food and energy prices soaring, are raising concerns among experts about an economic slowdown or even a recession.
Yellen remarks came a day after JPMorgan CEO Jamie Dimon warned on uncertainty. “We do not know what its outcome ultimately will be” he said. JPMorgan estimates the U.S. economy will advance roughly 2.5%, compared to the institution’s initial forecast of 3%.