War is raging in Ukraine, the Russian army is stalling and the Ukrainians are resisting. The extent of the sanctions imposed by Western countries surprised Vladimir Putin, and raw material prices grew sharper. What was originally meant to be a quick “special operation” is turning into a long-running conflict. After 2 years of global health crisis, this war, of which we thought was from another time, will have a considerable geopolitical impact.

The excessive globalization of the world economy which was already dented by the Covid pandemic will struggle to maintain its momentum. High geopolitical tensions, lack of strategic sovereignty (medicines, energy, semiconductors, agricultural products, etc.) and the extreme fragility of a scattered and “just-in-time” production chain will lead to a reallocation of resource and a structural increase in inflation.

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Highlights

  • A particularly heterogeneous economic situation with significant sources of uncertainty.
  • Central banks under pressure to control a nascent inflationary spiral.
  • A defensive, yet selective and opportunistic investment approach is best in the current context.
Written on April 13th 2022.

This material is provided for informational purposes only and should not be construed as investment advice. The views and opinions expressed may change based on market and other conditions. There can be no assurance that developments will transpire as forecasted. Actual results may vary.

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