Question marks over Europe's defence splurges
Owen Jones has introduced a healthy scepticism into the debate about defence spending (Keir Starmer, you claim huge and damaging cuts are vital so we can buy arms and defend ourselves. Prove it, 5 March).
According to the Stockholm International Peace Research Institute, the European members of Nato have, collectively, significantly outspent Russia for years. In 2021, European members of Nato plus Canada spent more than four times the amount on their armed forces than Russia did. Even in 2023, when Russian expenditure had ballooned due to the war in Ukraine, these countries still spent nearly three times as much as the Russians. So could we have an explanation of where this money is going and why it is not enough?Richard HendersonBristol
'US stops sharing intelligence with Kyiv to pile pressure on Zelenskyy' says the headline on a front-page story in your print edition (6 March). Probably just as well; right now, it doesn't seem to have a lot to spare.Sam GibsonRavensthorpe, Northamptonshire
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Rhyl Journal
27 minutes ago
- Rhyl Journal
Gatwick-bound plane carrying 53 British nationals crashes in India
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South Wales Guardian
27 minutes ago
- South Wales Guardian
Three killed in Ukraine as Russia continues drones offensive
According to the Ukrainian air force, Russia launched a barrage of 63 drones and decoys at Ukraine overnight. It said that air defences destroyed 28 drones while another 21 were jammed. Ukraine's police said two people were killed and six were injured over the past 24 hours in the eastern Donetsk region, the focus of the Russian offensive. One person was killed and 14 others were also injured in the southern Kherson region, which is partly occupied by Russian forces, police said. The head of the Kharkiv region, Oleh Syniehubov, said 15 people, including four children, were injured by Russian drone attacks overnight. Kharkiv city mayor Ihor Terekhov said Russian drones targeted residential districts, educational facilities, nurseries and other civilian infrastructure. 'Kharkiv is holding on. People are alive. And that is the most important thing,' Mr Terekhov said. The Russian military has launched waves of drones and missiles in recent days, with a record bombardment of almost 500 drones on Monday and a wave of 315 drones and seven missiles overnight on Tuesday. The recent escalation in aerial attacks has come alongside a renewed Russian battlefield push along eastern and north-eastern parts of the 600-mile front line. While Russian missile and drone barrage have struck regions all across Ukraine, regions along the front line have faced daily Russian attacks with short-range exploding drones and glide bombs. Ukraine hit back with drone raids, with Russia's defence ministry saying air defences downed 52 Ukrainian drones early on Thursday, including 41 over the Belgorod region that borders Ukraine. Regional governor Vyacheslav Gladkov said three people were injured by Ukrainian attacks. The attacks have continued despite discussions of a potential ceasefire in the war. During their June 2 talks in Istanbul, Russian and Ukrainian negotiators traded memorandums containing sharply divergent conditions that both sides see as non-starters, making any quick deal unlikely. Speaking at a meeting of leaders of south-east European countries in Odesa, Ukrainian President Volodymyr Zelensky urged the European Union to toughen its latest package of sanctions against Russia. He argued that lowering the cap on the price of Russian oil from 60 US dollars (£44) to 45 dollars (£33) as the bloc has proposed is not enough. German defence minister Boris Pistorius arrived in Kyiv on Thursday on an unannounced visit, noting that the stepped-up Russian attacks on Ukraine send a message from Moscow that it has 'no interest in a peaceful solution at present', according to German news agency dpa. Pistorius said his visit underlines that the new German government continues to stand by Ukraine. 'Of course this will also be about how the support of Germany and other Europeans will look in future – what we can do, for example, in the area of industrial co-operation, but also other support,' he said.
Reuters
38 minutes ago
- Reuters
Morning Bid: Oil pops, dollar drops
LONDON, June 12 (Reuters) - What matters in U.S. and global markets today I'm excited to announce that I'm now part of Reuters Open Interest (ROI), opens new tab, an essential new source for data-driven, expert commentary on market and economic trends. You can find ROI on the Reuters website, opens new tab, and you can follow us on LinkedIn, opens new tab and X., opens new tab Intro Not for the first time this year, markets are being hit by multiple crosscurrents. Today it's an oil price surge driven by Middle East tensions alongside surprisingly benign U.S. inflation readings. I discuss this and the rest of today's market news below. In today's column, I explore a surprising twist in the global dollar debate that could reshape how investors think about currency risk. I'll be off tomorrow so Morning Bid will take a day's holiday, but back to regular programming on Monday. Today's Market Minute * U.S. President Donald Trump said on Wednesday U.S. personnel were being moved out of the Middle East because "it could be a dangerous place", adding that the United States would not allow Iran to have a nuclear weapon. * U.S. consumer prices increased less than expected in May as cheaper gasoline partially offset higher rents, but inflation is expected to accelerate in the coming months on the back of the Trump administration's import tariffs. *An Air India plane bound for London with 242 people on board crashed minutes after taking off from India's western city of Ahmedabad on Thursday, the airline and police said, and India's federal health minister said that "many people" were killed. * U.S. trade negotiations have transitioned from their tumultuous opening act into a new chapter: the Slow Grind. It may be less turbulent than this past spring's drama, but no less worrying for investors. * A proposed U.S. tax targeting foreign investors could hurt European energy giants that operate in America's booming oil and gas sector, undermining President Donald Trump's energy dominance agenda. Read the latest from ROI columnist Ron Bousso. Oil pops, dollar drops With investors trying to read the runes of this week's 'framework' trade agreement between the U.S. and China on Wednesday, worries surfaced about the state of play in the Middle East after the U.S. announced that it was moving personnel out of the region ahead of talks with Iran over the latter's nuclear-related activity. Crude oil prices promptly jumped 4% and hit their highest in two months before giving up some of those gains earlier today. European travel stocks and auto makers fell more than 2% on Thursday on the jitters. Gold , however, was only marginally higher, and the dollar (.DXY), opens new tab fell. While no specific reason was given for the U.S. personnel orders, the U.N. nuclear watchdog passed a resolution on Thursday formally declaring Iran in breach of its non-proliferation obligations for the first time in almost 20 years. Concern about Israeli threats to Iran's nuclear facilities inevitably ramped up. The prospect of higher energy prices at a time of tariff-related inflation concerns will certainly rankle. But so far at least, the Trump administration's import levies aren't putting much upward pressure on U.S. consumer prices, as May CPI came in below forecasts on Wednesday. Core annual producer price readings due out later today are expected to be steady. Despite this week's crude gains, year-on-year oil prices are still down more than 10%. And two-year U.S. 'breakeven' inflation rates in the inflation-protected Treasury market fell to their lowest of the year at 2.44%. Meanwhile, U.S. Treasury yields fell on a mix of soft inflation and robust demand at the 10-year auction on Wednesday. Some $22 billion of 30-year bonds are up for grabs later today, testing the recently shaky demand for long-duration debt. Federal Reserve expectations haven't shifted greatly, with two quarter-point interest rate cuts still priced by yearend. No move is expected before September, even though President Donald Trump once again called for an immediate full percentage point rate cut after the CPI report. The dollar remains under pressure however, raising more concern about the absence of its traditional 'safe haven' role at a time of rising geopolitical tensions. The dollar index (.DXY), opens new tab fell to its lowest level since April, with the euro surging above $1.15 to within a whisker of its best levels since 2021. Sterling was a standout loser against the euro, falling to its weakest against the single currency in a month after a surprisingly sharp drop in April UK GDP. Stocks were slightly shaken by the whole picture, with the S&P500 (.SPX), opens new tab ending in the red on the Middle East news on Wednesday and futures down almost half a percentage point ahead of Thursday's open. Chinese, Japanese and European bourses were all in the red on Thursday. Only South Korea's Kospi bucked the trend. The wider trade war picture remained uncertain despite the U.S.-China progress, with details still patchy as the negotiated deal in London awaited final approval. Trump on Wednesday said he was very happy with the trade deal, as it restored a fragile truce between the two biggest economies, claiming China agreed to free up rare earth supplies in exchange for the U.S. allowing Chinese students to attend U.S. colleges. But he also insisted: "We are getting a total of 55% tariffs, China is getting 10%." White House officials said the 55% represents the sum of a baseline 10% "reciprocal" tariff Trump has imposed on goods imported from nearly all U.S. trading partners, the 20% fentanyl-related tariffs, and pre-existing 25% levies on imports from China that were put in place during Trump's first term. Commerce Secretary Howard Lutnick said the 55% rate on Chinese imports is fixed and unalterable. Treasury Secretary Scott Bessent said the deal would not reduce U.S. export restrictions on high-end artificial intelligence chips. China on Thursday affirmed the trade deal, and a foreign ministry spokesperson said: "Now that a consensus has been reached, both sides should abide by it." But with less than four weeks to go before the expiration of the 90-day pause on U.S. tariffs worldwide, markets remain concerned about what will happen next month. Trump said on Wednesday he would be willing to extend a July 8 deadline for completing trade talks, but also said he did not believe that would be necessary, noting: "At a certain point, we're just going to send letters out ... saying, 'This is the deal. You can take it, or you can leave it.'" European Union talks, in particular, look unlikely to be concluded by then. Elsewhere, Boeing shares fell 6% pre-market after news that an Air India plane headed to London with 242 people on board crashed minutes after taking off from India's western city of Ahmedabad. Be sure to check out today's column, which looks at the weakening dollar and the debate about whether its decline is being driven by flight from U.S. assets at large or simply foreign investors hedging their dollar exposure. Chart of the day The UK may be seeing the downsides of publishing noisy monthly GDP readouts as opposed to quarterly updates. The April GDP report threw cold water on a relatively robust start to the year for the UK economy, showing a surprising 0.3% contraction during the month. However, it remains very unclear how much of the April loss will be durable through the second quarter. Either way, the data will put pressure on the Bank of England to step up monetary easing. Consequently, both sterling and UK government bond yields fell back after the GDP release. Today's events to watch * U.S. May producer price report (8:30 AM EDT), weekly jobless claims (8:30 AM EDT) * Federal Reserve issues Quarterly Financial Accounts of the United States (11:00 AM EDT) * U.S. Treasury auctions $22 billion of 30-year bonds * European Central Bank Vice President Luis de Guindos and ECB board member Isabel Schnabel both speak in Brussels * U.S. corporate earnings: Adobe Opinions expressed are those of the author. They do not reflect the views of Reuters News, which, under the Trust Principles, opens new tab, is committed to integrity, independence, and freedom from bias. Want to receive the Morning Bid in your inbox every weekday morning? Sign up for the newsletter here.
