Canadian Outlook

The Omicron wave of the COVID-19 pandemic had largely worked its way through the population this winter, and Canadians had been looking forward to life returning to normal. Russia’s invasion of Ukraine, however, threw that hope out the window. While the human tragedies inside Ukraine’s borders make the impacts on Canada and Canadians seem tiny in comparison, the invasion does add plenty of future risks and unknowns to our outlook.

Russia, it appears, had banked on a lightning strike leading to the quick submission of the Zelensky government in Ukraine. Now that Russia’s army has bogged down and international sanctions are starting to bite down hard on its economy, risks of escalation have only multiplied.

Canada is not a significant trading partner with Russia, so the interruption of direct imports or exports between the two countries will not have a large effect. The commodity price surge that followed the invasion, however, will have significant impacts—both positive and negative.