Russia’s Invasion of Ukraine and Geopolitical Risks

「Downside risks to the economy increased following heightened tensions in the Middle East and other factors from late February onward.」

「As uncertainty in the global economy increases, concern is also growing over adverse effects on the Japanese economy from heightened international tensions. Following the 2026 spring labor-management wage negotiations, major companies have indicated wage increases of more than 5%, while higher energy prices and other factors may weigh on personal consumption. Although companies' appetite for capital investment remains robust, if the highly uncertain business environment continues, investment plans may increasingly be reviewed or deferred.」

「Geopolitical risks are increasing as the situation in the Middle East deteriorates, and caution is warranted regarding the impact on the global economy.」

「The outbreak of the Israel-Hamas conflict has made the international situation even more unstable, and its effects are beginning to emerge in supply chains and other areas.」

「Adverse effects on the global economy, including restrictions on imports and exports, suspensions of local business operations and production, and logistics delays, have also become tangible.」

「Russia's invasion of Ukraine, which began in February, has sharply increased global economic and geopolitical risks. The United States, Europe and other countries have imposed economic sanctions on Russia, and energy prices have risen further. The effects have already begun to emerge in various areas, including restrictions on imports and exports, suspensions of local business operations and production, and logistics delays. With some expecting the situation to be prolonged, concern is growing over further adverse effects on the global economy.」