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Yellen warns that war in Ukraine will have ‘enormous’ global economic impact

U.S. Treasury Secretary Janet Yellen testifies before a House Financial Services Committee hearing on “the State of the International Financial System,” on Capitol Hill in Washington, U.S., April 6, 2022.
Tom Brenner | Reuters

Treasury Secretary Janet Yellen cautioned Wednesday that Russia’s attack on Ukraine could cause a major hit to the global economy.

“Russia’s actions, including the atrocities committed against innocent Ukrainians in Bucha, are reprehensible, represent an unacceptable affront to the rules-based global order, and will have enormous economic repercussions for the world,” Yellen told a House panel in a hearing on the world’s financial system.

Along with the dour outlook in the war’s impact, Yellen said global organizations such as the International Monetary Fund and World Bank are working together to provide aid to Ukraine and sanction Russia.

She added that the White House believes Russia should be cut off from the system in retribution for its “brutal and unprovoked invasion of Ukraine.”

However, she noted that European nations in particular are still reliant on natural gas from Russia, necessitating the need for licensing of Russia-based companies.

“It cannot be business as usual for Russia in any of the financial institutions,” Yellen said.

Earlier in the morning, the administration outlined a fresh round of sanctions against Russia, including penalties against President Vladimir Putin’s children and prohibitions on new investment in Russia.

Along with the comments on the war, Yellen said spoke on the battle against the Covid pandemic. She said the U.S. remains committed to vaccine availability and readiness.

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