Economics news: The stories to read this week

International businesses continue to pull back from Russia in light of the country's invasion of Ukraine.

Global financial conditions – generally perceived as closely correlated to future economic growth – are at their tightest in two years.

Companies, banks and investors have so far announced that their exposure to Russia amounts to more than $110 billion, but that number could rise.

Wheat futures hit an all-time high on Tuesday before falling again, as the Russian invasion of Ukraine causes disruption to global food supplies, Bloomberg reports.

Leading ratings agency Fitch warned on Wednesday that Russia is likely to soon default on its debts. It has downgraded the country's bonds further into "junk" territory.

The World Bank has issued a similar warning. The bank's chief economist, Carmen Reinhart, said that Russia and Belarus are in "square default territory".

Reinhart also warned that rising energy and food prices could fuel growing social unrest, particularly in the Middle East and Africa.

Persistent high oil prices prompted by Russia's invasion of Ukraine could cut a full percentage point off the growth of large oil-importing developing economies such as China, Indonesia, South Africa and Turkey, a World Bank official said on Tuesday.

Economists, including at Barclays and JPMorgan Chase, are lowering forecasts for global growth and raising those for consumer prices.

US President Joe Biden signed an executive order on Wednesday requiring the government to assess the risks and benefits of creating a central bank digital dollar, as well as other cryptocurrency issues.

The International Monetary Fund (IMF) has warned that the war in Ukraine will have a "severe impact" on the global economy.

The global lender said that the conflict is already driving energy and grain prices higher. The war has also sent more than 1 million refugees to neighbouring countries and triggered unprecedented sanctions on Russia.

"While the situation remains highly fluid and the outlook is subject to extraordinary uncertainty, the economic consequences are already very serious," the IMF said in a statement after a board meeting chaired by Managing Director Kristalina Georgieva.

"The ongoing war and associated sanctions will also have a severe impact on the global economy," it warned, noting that the crisis is creating an adverse shock to inflation and economic activity at a time when price pressures are already high.

Oil prices jumped on Tuesday after the US announced a ban on imports of Russian oil and other energy products. The UK also said it would phase out the import of Russian oil and oil products by the end of this year – giving the market and businesses time to find alternatives.

Russia ships 7 million to 8 million barrels per day of crude oil and fuel to global markets and is the world's second-largest exporter of crude. European allies are not expected to join the US in the ban, but major buyers on the continent are already shunning Russian oil.

The disruption could ripple through other energy markets, as Russian oil and products are used for refining into other goods. "We are at the beginning of that shockwave in energy markets," said Roger Diwan, Vice-President of Financial Services at S&P Global.

Oil prices have risen by more than 30% since the invasion, prompting concerns about the cost of fuel and exacerbating existing worries about the cost of living in countries around the world.

The Kremlin responded by accusing the US of declaring an economic war on Russia. It said it is considering its response to the ban.