Biden authorises Ukraine to strike Russia with long-range US missiles

At this time’s agenda: G20 summit begins; ECB report on financial institution capital necessities; monitoring the German election; stealth sackings; and offshore oil is again

Good morning. We kick off the week with information that US President Joe Biden has authorised Ukraine to launch restricted strikes into Russia utilizing US-made long-range missiles, two folks acquainted with the choice mentioned.

What induced the coverage shift? Biden is shifting his stance in response to the deployment of hundreds of North Korean troops to help Moscow’s battle effort and after a barrage of Russian strikes on Ukrainian cities on the weekend.

The transfer comes after months of resisting pleas by Ukraine’s President Volodymyr Zelenskyy to raise restrictions on the usage of western-made, long-range weapons inside Russia, and about two months earlier than the top of Biden’s White Home time period in January.

Why it issues: “Even if limited to the Kursk region, ATACMS [Army Tactical Missile System] missiles put at risk high value Russian systems, assembly areas, logistics, command and control,” mentioned Michael Kofman, senior fellow on the Carnegie Endowment for Worldwide Peace think-tank. “They may enable Ukraine to hold on to Kursk for longer and raise the costs to North Korea for its involvement in the war.”

Invoice Taylor, former US ambassador to Ukraine, mentioned Biden’s determination made “Ukraine stronger and increases the odds of a just end to the war” and “may also unlock British and French missiles. Possibly even German”. Learn the total story.

And right here’s what else we’re preserving tabs on at present:

• G20 summit: Officers from the world’s richest nations collect at present in Rio de Janeiro, with Donald Trump’s re-election threatening to disrupt worldwide initiatives on local weather change and taxation. UK Prime Minister Sir Keir Starmer may even urge G20 leaders to “double down” on help for Ukraine.

• UK-China ties: Starmer holds the first face-to-face talks by a British prime minister with China’s President Xi Jinping since 2018.

• UK weapons lawsuit: London’s Excessive Court docket begins listening to a case towards the earlier UK authorities’s determination to proceed arms gross sales to Israel.

• UK financial knowledge: Rightmove releases its November home value index and S&P World publishes its UK shopper sentiment index.

• Firms: Boohoo is because of announce the outcomes of its retail supply of latest extraordinary shares. Large Yellow Group, Cerillion and Sirius Actual Property have outcomes.

5 extra high tales

1. Iran has stored the door open to negotiations with Donald Trump’s administration, however warned that any try to reimpose “maximum pressure” will fail to extract concessions from the Islamic republic. Learn the Monetary Instances’ interview with deputy overseas minister Majid Takht-Ravanchi, who mentioned the 2015 nuclear deal — from which Trump withdrew — “could still serve as a foundation”.

2. Unique: The European Central Financial institution is debating whether or not to publish delicate analysis displaying capital necessities for giant EU lenders would rise by a double-digit proportion in the event that they confronted the identical guidelines as massive Wall Road rivals. Right here’s what else we all know concerning the ECB report, which some senior policymakers are pushing to publish to counter heavy lobbying to water down the foundations.

3. The UK authorities may pressure pension funds to speculate extra in British belongings if reforms fail to drive financial savings into home infrastructure and corporations. Pensions minister Emma Reynolds instructed the FT: “We are an outlier in terms of our own pension schemes.” Learn the total report.

4. European plastics producers are closing vegetation amid a deep decline in manufacturing as EU firms battle to compete with a worldwide glut of low cost materials. Plastic manufacturing in Europe declined 8.3 per cent in 2023, in sharp distinction with a 3.4 per cent improve globally as nations together with China and the US scaled up manufacturing.

5. US enterprise leaders are warning that Donald Trump’s plan to deport thousands and thousands of undocumented employees may create mass labour shortages, closing eating places, crippling farms and small companies and elevating costs. One immigration lawyer mentioned: “People are worried about the price of food now? Wait until [food producers] can’t get workers.”

Enroll for our White Home Watch publication for extra updates from Washington because it braces itself for Trump’s second time period.

The Large Learn

Years after one of many worst spills in historical past within the Gulf of Mexico, oil firms are drilling even deeper into the seabed in the hunt for discoveries. However whereas the trade heralds a new period in offshore drilling, the rise in exercise — with virtually $104bn anticipated to be invested this 12 months — has raised considerations.

We’re additionally studying and listening to . . . 

• Investability hole: UK banks are bracing themselves for a aggressive risk from Donald Trump’s deregulatory agenda that’s set to carry many advantages for US banks, writes Patrick Jenkins.

• EU problem: Leaders throughout the Atlantic know they need to make Europe nice once more. However the place is the cash going to come back from?

• Stealth sackings: Small-scale dismissals — over seemingly minor violations — are prompting questions on whether or not price financial savings are being disguised.

• Economics Present 🎧: Soumaya Keynes asks Kimberly Clausing, a professor at UCLA and previously Biden administration economist: would Trump’s tariffs actually be that unhealthy?

Chart of the day

The German federal election on February 23 will decide the destiny of Europe’s largest financial system. Voters will go to the polls seven months sooner than deliberate after the ruling coalition collapsed this month. Observe the FT’s reside ballot tracker right here.

Take a break from the information

The Who’s 1966 observe that cemented the band’s pivotal function in rock’s growth — ‘Substitute’ — is a witty snapshot of an insecure British youth negotiating the last decade’s radical social change. The track typified the more durable, louder ‘rock’ style, and was later lined in a number of types.