February 2022 will sadly be remembered as the month that Russia invaded Ukraine. As well as the deeply troubling impact on human lives, markets took fright from the initial impact with much uncertainty on the outcome remaining. Given European reliance on Russia for energy, gas and oil prices spiked towards the end of the month, after already having risen in response to rising tensions and low gas inventories. This has served to push global inflation expectations up and global growth expectations down, a challenge for all central banks and a challenge to all their prior signaling. Both equity and bond prices fell on the initial news but indices with more energy exposure (for example the FTSE 100 and EM Latin America) had a relatively better month.

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