Both equity and bond markets suffered through February as concerns surrounding the Russian invasion of Ukraine took hold. At the start of the month, investors were concerned that central banks were going to derail growth in their efforts to get inflation under control. These concerns were quickly absorbed by the conflict in Ukraine, with expectations for aggressive rate hikes being alleviated. Commodities outperformed through this period as Oil and Natural Gas prices rose – this, in turn, bolstered returns in markets such as the FTSE 100, given the weighting to energy and mining stocks. Europe ex-UK was the worst performer through February due to its reliance on Russian energy exports. Rising energy prices will likely extend the period of high inflation further, but it is not yet clear how central banks will react, as the cost pressure on consumers will likely act as a natural brake on economic growth. Tight labour markets remain, however, the risk of a wage-price spiral may warrant further tightening measures. In the UK, the BoE raised rates by 25bps in February. The US is yet to raise rates, but the market is still expecting 5-6 hikes by the end of the year, with at least one of them due in March. Looking forward, geopolitical risk will dominate markets as the second-order effects of higher energy prices impact inflation and monetary policy.