Before Russia invaded Ukraine, the markets were digesting the impact of higher interest rates and rising inflation. These concerns are still valid; however, the tragic Russian invasion of Ukraine has taken center stage. The Russian economy does not impact the US economy directly, as our trade with them is limited. However, our economy relies on natural resources such as oil, aluminum, uranium, and nickel. We may not directly import these commodities from Russia; however, they are priced globally and impact our costs.
All these commodity prices have surged as the West tries to shut out Russian supplies. Shutting out Russian supplies will be very difficult as it is almost impossible to replace them in the short to medium term. In my opinion, China and India may end up purchasing Russian commodities at a steep discount to global prices. While these purchases are not ethical, these countries have long ties to Russia and may not be able to turn down a deep discount to market prices.
Below is a video on how commodity prices could impact our daily lives. In the end, food commodities in Western countries will be more expensive, but still available to buy. On the other hand, poor countries may have a food supply issue that could result in true hardship.
The iShares EAFE (EFA) invest in developed international markets, not including the U.S. and Canada. It invests in Europe, Australia, Asia, and the Far East.