UK: Russia heading for deeper recession since collapse of Soviet Union

Russia is heading for a deeper recession since the collapse of the Soviet Union, the UK government has predicted. Economists expect Russia’s GDP to shrink between 8.5% and 15% this year, the United Kingdom has said, as it announces sanctions on Vladimir Putin’s two adult daughters. GDP growth is likely to slow in the long run, as Russia is cut off from Western technology, he added. Some 27 275 billion, or 60% of Russia’s foreign exchange reserves, are currently frozen, the United Kingdom estimates, hampering Moscow’s ability to support its economy. Foreign Minister Liz Truss said: Our unprecedented package of sanctions hurts the elite and their families, while degrading the Russian economy to a level not seen by Russia since the fall of the Soviet Union. But we need to do more. Through the G7, we are working with partners to end the use of Russian energy and further undermine Putin’s ability to finance his illegal and unwarranted invasion of Ukraine. Together, we tighten the noose on Russia’s war machine, cutting off Putin’s cash sources. Last month, the Institute of International Economics predicted that Russia’s economy would shrink by 15% this year and that further boycotts of Russian energy would severely damage its ability to import goods and services. These worries about the recession pushed Russia’s central bank to cut interest rates from 20% to 17% this morning. #Russia offers a surprise cut in interest rates by 300 basis points from 20% to 17% amid a recession, the ruble is recovering. The risk of financial stability is no longer growing, says the Bank of Russia. The central bank says further cuts may be made in future meetings. The ruble remains below 80 per dollar. pic.twitter.com/olaQr7FMrh – Holger Zschaepitz (@Schuldensuehner) April 8, 2022 The freezing of foreign exchange prevented Russia from paying its sovereign debt holders more than $ 600 million earlier this week. The US Treasury Department has blocked Russia’s ability to make dollar-denominated debt payments through US banks, which means Moscow has had to keep rubles away. This could be considered a debt default, after a 30 day grace period. Updated on 11.03 BST Before 53 meters 10:33

The United Kingdom ratifies the daughters of Putin and Lavrov

The United Kingdom has added the daughters of Russian President Vladimir Putin to its sanctions list, a move by the United States this week. Katerina Tikhonova and Maria Vorontsova, Putin’s two adult daughters with his ex-wife Lyudmila Skrebneva and Yekaterina Sergeyevna Vinokourova, daughter of Foreign Minister Sergei Lavrov, will be subject to travel and The United Kingdom says the move will further target “the rich lifestyle of the Kremlin.” By freezing assets and restricting the travels of Putin’s allies, the UK government is sealing the coffers that fund the conflict, while ensuring that those who have benefited from Putin’s rule feel the effects. New sanctions in Russia Της EU ban on Russian coal imports ση Ban on Russian ships in EU ports Η The UK imposes sanctions on Putin’s daughters – Scott Beasley (@SkyScottBeasley) April 8, 2022 My colleague Rupert Neate wrote about Tikhonova and Vorontsova earlier this week: Katerina Tikhonova, 35, the youngest daughter, was born in Dresden in 1986 while Putin worked as a KGB spy. Tikhonova, who uses her grandmother’s surname from her mother, studied at St. Petersburg State University and Moscow State University and has a master’s degree in physics and mathematics. In addition to her studies, Tikhonova has a passion for Japanese culture and rock’n’roll acrobatics, a boogie-woogie sport. In 2013, together with her dancing partner, she was fifth in the world championship in Switzerland. These were shots from her dance competitions, compared to photos from the website of Moscow State University, where she works, that helped to establish for the first time that Tikhonova was Putin’s daughter in 2015. Putin’s eldest daughter, Maria Vorontsova, 36, is a pediatric endocrinologist who studies the effects of hormones on the body. In 2019, Vorontsova, who lives in a penthouse apartment opposite the US embassy in Moscow, gave an interview to Russian state television, revealing plans for a 500 500 million medical project to help treat cancer. Vorontsova married Dutch businessman Jorrit Faassen and the couple lived in the penthouse of an exclusive apartment building in Voorschoten, near The Hague. In 2014, some Dutch neighbors demanded that he be expelled from the country after the downing of MH17 by pro-Russian forces over Ukraine. Updated at 10.35 BST 1 hour ago 10:03

Russia’s central bank cuts interest rates to 17%

Just: Russia’s central bank cuts interest rates from 20% to 17%. The move reversed part of the doubling of interest rates last month, when the war in Ukraine sparked the first wave of sanctions on Russia and pushed the ruble down. STOP:

  • THE BANK OF RUSSIA REDUCES THE BASIC INTEREST RATE BY 300 BPS TO 17% 🇷🇺🇷🇺 – Investing.com (@Investingcom) April 8, 2022 Explaining the move, the Bank of Russia said inflationary pressures had eased as the ruble had partially recovered and risks to financial stability had stabilized but remained. He also warns that Russia’s economic activity remains “significantly” limited by external conditions. Today’s decision reflects a change in the balance of risks of accelerating consumer price growth, declining economic activity and risks of financial stability. This week’s data showed that Russia’s services sector shrank sharply last month, with economists predicting a sharp recession this year. The Bank of Russia adds that it could reduce interest rates again in future meetings: In further decisions on key interest rates, the Bank of Russia will take into account the risks arising from external and domestic conditions and the reaction of the financial markets, as well as the actual and expected inflation dynamics in relation to the target and economic developments on the horizon, and keeps open the prospect of further reduction of key interest rates in its forthcoming meetings. 2 hours before 09:42 hours before 09:37 As for food, Ukrainian Prime Minister Denys Shmyhal has predicted that this year’s grain harvest is likely to be 20% lower than last year, due to the reduced sowing area after the Russian invasion. He said there was a shortage of fuel for farmers, but Ukraine knew how to supply it. He also said that Ukraine has large reserves of grain, cereals and vegetable oils and can feed its population (via Reuters). 2 hours ago 09:35 The following is a graph showing the jump in food prices: Updated at 09.36 BST 2 hours ago 09:30

World food prices are skyrocketing

An ear of corn in a field near the village of Hrebeni in the Kiev region, Ukraine. Photo: Valentyn Ogirenko / Reuters World food prices soared to a new record high in March as the war in Ukraine pushed up prices, adding to inflationary pressures on people around the world. The UN Food and Agriculture Organization reports that food prices rose by almost 13% last month, according to the index that monitors staple foods. Vegetable oils, cereals and meat hit record highs, while prices of sugar and dairy products also rose sharply. The Food and Agriculture Organization says the food price index, which tracks the most traded food products in the world, made a “huge leap” in March, to 159.3 points from 141.4 in February. Cereal prices rose by a record 19.7% in March due to the war in Ukraine, the FAO explains: This month’s increase reflects rising world prices for wheat and coarse grains, largely due to disruptions to exports from Ukraine and, to a lesser extent, to the Russian Federation due to the conflict. The expected loss of exports from the Black Sea region exacerbated the already limited global availability of wheat. With concerns about growing conditions in the United States also boosting support, world wheat prices rose sharply in March, jumping 19.7%. Vegetable oils also hit record highs, up 23% a month, as supplies from major exporters Russia and Ukraine fell. The sharp rise of the index is due to the higher prices of sunflower, palm oil, soybean and rapeseed oil. International sunflower oil prices rose sharply in March, fueled by declining export supplies amid continuing conflict in the Black Sea region. Meanwhile, prices for palm oil, soybeans and rapeseed oil also rose sharply, driven by rising global import demand following the disruption of sunflower oil supply. The conflict in Ukraine also contributed to last month’s record meat prices, which rose another 4.8%, the FAO added. In March, pork prices recorded the sharpest monthly increase since 1995, due to shortages of slaughtered pigs in Western Europe and rising domestic demand ahead of the coming Easter holidays. International poultry meat prices stabilized, fueled by reduced supplies from top exporting countries following cases of bird flu, further affected by Ukraine’s inability to export poultry meat amid the ongoing conflict. Updated at 09.54 BST 2 hours ago 09:07 There is further unhappiness for some airline passengers today, with travel journalist Simon Calder reporting that British Airways canceled another 68 flights and easyJet canceled 42. There is a handy list here. Good morning from Heathrow Airport, where British Airways canceled another series of overnight flights – including Athens, Larnaca and Prague. Along with easyJet cancellations, there are at least 100 flights canceled today. More over the weekend 🔽https: //t.co/77bG9FEvf5 – Simon Calder (@SimonCalder) April 8, 2022 All current flight cancellations so far.68 on British Airways, including delayed landings to Athens, Larnaca and Prague.42 on easyJet, including Gatwick to Agadir and Bristol to Dubrovnik. Airlines must bring passengers to their destination todayhttps: // t.co/RIPvYaY64x – Simon Calder (@SimonCalder) April 8, 2022 Updated on 09.11 BST 3 hours ago 08:50 Next weekend will also be …