Asian shares were trying to rally on Thursday after reassuring comments from the Federal Reserve helped Wall Street bounce, even as the war in Ukraine sent oil and commodity prices spiralling ever higher in a grim omen for global inflation.
Brent crude is now up almost 20 per cent on the week, while everything from coal to natural gas and aluminium is on fire as Western nations tighten sanctions on Russia.
Ukraine’s second-biggest city, Kharkiv, suffered heavy bombardment on Wednesday and dozens of countries referred Moscow to be probed for potential war crimes.
“So far, investors appear to be discounting a greater chance of “stagflation-lite”, meaning sanctions result in even more inflation in developed markets and a bit less economic growth,” said Thomas Mathews, a markets economist at Capital Economics.
