Musemio co-founder and CEO Olga Kravchenko details what it’s like as a business owner in Ukraine amid war with Russia.
The United States and its allies continue to ramp up the economic pressure on Russia following the country’s decision to invade Ukraine. Here is a FOX Business roundup of actions taken against Russia thus far.
Temporary halting of Russian company stock trading on NYSE, Nasdaq
On Monday, the New York Stock Exchange temporarily halted trading of select Russian-based companies, including Mechel PAO American Depositary Shares, Mobile TeleSystems Public Joint Stock Company and Cian PLC American Depositary Shares.
Sources familiar with exchanges tell FOX Business that the halts, which can be used for unusual trading in any security, will allow time for officials to review the fast-moving developments in the Russia-Ukraine conflict that are impacting the shares.
Freezing Russian central bank asset transactions
In conjunction and cooperation with the European Union, Japan, the U.K., Canada, and others, the United States has effectively frozen financial transactions of Russian central bank assets held by Americans, a senior administration official told reporters during a briefing on Monday.
The intended effect is to cripple the Russian economy and use up the country’s “rainy day fund” as its currency, the ruble, plummets in value, the official said. That rainy day fund was built up to defend against economic consequences when Russia invaded Crimea in 2014.
According to the Treasury Department’s Office of Foreign Assets Control (OFAC), this is not a complete and total block of the central bank, as OFAC is authorizing certain transactions with Russia’s central bank that are “energy-related.” OFAC added that additional authorizations could follow if necessary.
SWIFT provides messaging services to banks in over 200 countries, and is controlled by the central banks of the G-10, including Belgium, Canada, France, Germany, Italy, Japan, the Netherlands, the United Kingdom, the United States, Switzerland, and Sweden.
In addition, the statement noted that the group of countries would launch a “transatlantic task force” aimed at effectively implementing the financial sanctions, “step up” coordination against disinformation regarding the Russian invasion, and limit “golden passports” that allow wealthy Russians connected to the Russian government to become citizens of the countries.
Export controls
On Thursday, the Commerce Department unveiled sweeping export controls from its Bureau of Industry and Security that would severely restrict Russia’s access to technologies and other items used by its defense, aerospace and maritime sectors.
Items targeted by the export controls include semiconductors, computers, telecommunications, information security equipment, lasers and sensors. In addition, BIS’s rule imposes stringent controls on 49 Russian military end users, which have been added to its entity list.
The European Union, Japan, Australia, United Kingdom, Canada and New Zealand announced that they would implement “substantially similar restrictions.”
Sanctions’ potential economic impact and Russia’s response
JPMorgan told clients in a research note reviewed by FOX Business on Monday that sanctions announced against Russia could have a “severe” impact on the country’s economy.
“We tentatively assume that Russia’s economy will contract 20% [quarter-over-quarter], saar, in 2Q, and for the year around 3.5%. But the margin of error for any such guesstimate is incredibly high at this point, and risks are skewed heavily to the downside,” the note reads. ” Moreover, we believe Russia’s growing political and economic isolation will curtail Russia’s growth potential in years to come and lower Russia’s trend growth to 1.0%, down from 1.75% previously.”
The bank’s researchers estimate that Russian inflation could stand at 10% at year-end, up from 5.3%, with risks heavily skewed to the upside.
In response to the sanctions, Russia’s central bank has raised its key interest rate to 20% from 9.5% to counter risks of rouble depreciation and higher inflation, ordered companies to sell 80% of their foreign currency revenues and restarted gold buying.
Fox Business’ Suzanne O’Halloran, Paul Conner, Ronn Blitzer and Adam Sabes contributed to this report
OTTAWA – The parliamentary budget officer says the federal government likely failed to keep its deficit below its promised $40 billion cap in the last fiscal year.
However the PBO also projects in its latest economic and fiscal outlook today that weak economic growth this year will begin to rebound in 2025.
The budget watchdog estimates in its report that the federal government posted a $46.8 billion deficit for the 2023-24 fiscal year.
Finance Minister Chrystia Freeland pledged a year ago to keep the deficit capped at $40 billion and in her spring budget said the deficit for 2023-24 stayed in line with that promise.
The final tally of the last year’s deficit will be confirmed when the government publishes its annual public accounts report this fall.
The PBO says economic growth will remain tepid this year but will rebound in 2025 as the Bank of Canada’s interest rate cuts stimulate spending and business investment.
This report by The Canadian Press was first published Oct. 17, 2024.
OTTAWA – Statistics Canada says the level of food insecurity increased in 2022 as inflation hit peak levels.
In a report using data from the Canadian community health survey, the agency says 15.6 per cent of households experienced some level of food insecurity in 2022 after being relatively stable from 2017 to 2021.
The reading was up from 9.6 per cent in 2017 and 11.6 per cent in 2018.
Statistics Canada says the prevalence of household food insecurity was slightly lower and stable during the pandemic years as it fell to 8.5 per cent in the fall of 2020 and 9.1 per cent in 2021.
In addition to an increase in the prevalence of food insecurity in 2022, the agency says there was an increase in the severity as more households reported moderate or severe food insecurity.
It also noted an increase in the number of Canadians living in moderately or severely food insecure households was also seen in the Canadian income survey data collected in the first half of 2023.
This report by The Canadian Press was first published Oct 16, 2024.
OTTAWA – Statistics Canada says manufacturing sales in August fell to their lowest level since January 2022 as sales in the primary metal and petroleum and coal product subsectors fell.
The agency says manufacturing sales fell 1.3 per cent to $69.4 billion in August, after rising 1.1 per cent in July.
The drop came as sales in the primary metal subsector dropped 6.4 per cent to $5.3 billion in August, on lower prices and lower volumes.
Sales in the petroleum and coal product subsector fell 3.7 per cent to $7.8 billion in August on lower prices.
Meanwhile, sales of aerospace products and parts rose 7.3 per cent to $2.7 billion in August and wood product sales increased 3.8 per cent to $3.1 billion.
Overall manufacturing sales in constant dollars fell 0.8 per cent in August.
This report by The Canadian Press was first published Oct. 16, 2024.
