Pick Your Poison
The immediate impact of war in Ukraine is the increased level of uncertainty across nearly all sectors and regions. This can be evidenced by the pullback in gold prices even as there are signs that the armed conflict could worsen. While energy prices have remained range-bound, upside pressure is expected to persist through the year due to low global inventories, diminished surplus production capacity, and insufficient investment. The effect will be felt across the economy as uses for oil & gas extend far beyond transportation. Coupled with persistent supply chain issues and the high inflation environment will remain well into 2023. Given that the move to tighten rates has been priced into the markets, the more present threat is that changing circumstances might force central banks to change course, leading to rapid unwinding in multiple sectors.
THE 375 PARK COVID MODEL FORECASTS ~ 96MM CASES (-3MM FROM FEBRUARY ‘22) AND A cCFR OF 1.3% (0% FROM FEBRUARY ’22) IN THE U.S. BY JULY ’22.