Alexandre Schwartsman: Tension in Ukraine should impact Brazil economically

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CNN economy expert Alexandre Schwartsman commented, this Monday (14), about the possible conflict between Russia and Ukraine and the economic impact that this would have on the market.

According to Schwartsman, the interesting thing in this context is trying to understand what could happen to global markets and the impacts for Brazil in the event of a Russian invasion.

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“We already have a clue in this regard through two movements. The first is what is happening right now, a sharp rise in the price of oil and oil products, particularly gas,” he explains.

“There was a 12% increase on Monday (14), Brent crude reaching around $96 a barrel – the highest price in seven years. On the other hand, the specialist says he sees a movement towards a “safe harbor”.

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“Investors sell their risky assets and return to US treasury bonds, a movement that strengthens the dollar relative to other currencies, including the real,” he explained.

Schwartsman stated that these two movements – an increase in the price of oil and oil products on the international market, and a strengthening of the dollar – will have a very clear impact on our inflation through the prices of oil products such as gasoline, cooking gas and diesel.

“We already had an alert from the Central Bank regarding the oil price perspectives, so we will have to keep interest rates even higher in case this happens”.

See more in the video above

Source: CNN Brasil

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