Russia's war in Ukraine marks its one year anniversary this week and one of the more surprising macroeconomic developments during this time has been the resilience of Russia's economy, which contracted by just 2.1% in 2022. More sanctions are coming, but unless the West imposes secondary sanctions and stops energy exports to Asia, Russia's economy is likely to embark on a slow recovery later this year. Elsewhere, Israel's controversial judicial reform remained in the spotlight this week and appears to have weighed on the shekel. A further sell-off in the currency could prompt FX intervention by the central bank and a larger interest rate hike than we currently expect (25bp) at the next meeting.
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