ECB Draghi Warns Russia That Ukraine Crisis Can Have Severe Economic Impact

Mario Draghi, European Central Bank president, has warned that the Ukraine crisis is likely to have a serious impact on Russian economic growth – but it’s not yet clear how much it will hurt Europe.

Asked about the crisis, Draghi says the ECB did not discussed potential scenarios from the ongoing crisis over Crimea at today’s meeting (in which it left interest rates unchanged)

Draghi tells reporters that the ECB has seen a major impact on the Russian and Ukraine economy, and some impact on countries which border them.

He then warns that Russia’s economy will take a major hit.

The growth impact on the Russian economy is severe…. but it is very, very difficult to see what is going to be the impact over two or three years.

The short-term impact on energy prices, for example, is small – but it could be very significant in two years, depending how events play out.

“We poor central bankers” cannot predict how events will play out, he concludes.

via The Guardian

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza