Russia-Ukraine conflict back in headlines | FX Research

Geopolitical tension is impacting markets this Tuesday after President Biden gave the green light for Ukraine to use long-range missiles supplied by the U.S. to strike inside Russia.

Russia has not been pleased with this development and has responded by stating that any decision to use long-range missiles against Russia would lead to heightened tensions.

President Putin has also signed an updated nuclear arms doctrine, which includes the possibility of a nuclear response to aggression by non-nuclear states supported by other nuclear powers. As a result, we are seeing a flight to safety back into the dollar, along with some downside pressure on U.S. equities—though not significantly, but enough to suggest a risk-off sentiment.

Looking ahead, key data releases include Canadian inflation, U.S. housing starts and building permits, and the New Zealand GDT auction.

Exclusive FX research from LMAX Group Market Strategist, Joel Kruger