Saving for that house deposit? KiwiSaver members warned to stay steady

PHOTO: Photo: 123RF

KiwiSaver members are being reminded not to lose their heads as their balances are hit by volatility caused by Russia’s invasion of Ukraine.

Global financial markets have been subject to wild swings since the invasion began late last week, as investors weigh up what effects the conflict and the subsequent sanctions on Russia would have on economic growth, energy prices and trade globally.

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The gyrations could be seen in the local sharemarket which slumped to a two-year low on reports of the Russian invasion of Ukraine last Thursday, falling 3.3 percent to 11,797, only to trim its losses on Friday and Monday, with a cumulative gain of 2 percent, taking the index to 11,978.

Financial analyst Jeffrey Halley from OANDA said the volatility hitting global commodities, currencies and stocks would continue this week.

He said the Western sanctions imposed on Russia make clear that Europe, the United States, and other nations were willing to incur some pain to oppose Russia.

However, that would mean higher prices for consumers and businesses, he said.

Financial Services Council chief executive Richard Klipin reminded KiwiSaver members to stay calm as the military aggression had knocked balances.

“The best course of action is to stay steady, to stay patient because most of these shocks will wash out over a long period of time.