The Ukrainian crisis and rising inflation have now become the most serious threats facing the global financial system, ABC News reports, citing the Federal Reserve.

“The Fed no longer sees the coronavirus pandemic as the biggest threat …. It has been replaced by the conflict in Ukraine and record inflation,” the publication said.

As the regulator noted, it is largely the events in Ukraine that have contributed to the rise in economic uncertainty.

“Further unfavorable surprises in inflation and interest rates, especially if accompanied by a downturn in economic activity, could adversely affect the financial system,” the article noted.After the start of the Russian military special operation to demilitarize and denazify Ukraine, the West has increased sanctions pressure on Moscow. Restrictive measures are primarily directed against the banking sector and supplies of high-tech products.

Many countries have announced the freezing of Russian assets. In Europe, calls to reduce dependence on Russian energy resources have become louder. But all this has already turned into economic problems for the West itself, causing a rise in fuel and food prices.The Kremlin called the sanctions an economic war, the likes of which has never been seen before. As President Vladimir Putin noted, the sanctions have dealt a serious blow to the entire global economy, and the West’s main goal is to worsen the lives of millions of people. According to him, the current events draw a line under the West’s global dominance in politics and economy.