Good morning and welcome to FirstFT as tensions rise between India and Pakistan. We’ll bring you the latest and we’re also covering:
Pakistan vowed to retaliate after India launched what appeared to be its most extensive military attack on its neighbour in decades. Here’s what we know.
India said it carried out “precision strikes” on nine “terrorist camps” in Pakistan in an operation it dubbed “Operation Sindoor” in part of the disputed region of Kashmir that Pakistan administers. Pakistan said India launched 24 strikes in six areas, killing at 26 people — including two children — and injuring 46. In response, Islamabad also said it had shot down five Indian fighter jets, while state media reported that Pakistani artillery was firing towards Indian-administered Kashmir.
Why it happened: Tensions have been rising since New Delhi linked Islamabad to last month’s militant attack which killed 26 people in Kashmir, a disputed region claimed by both countries. India said today that it had attacked Pakistan to bring the planners of the Pahalgam attack to justice and because it had evidence further attacks were impending. Pakistan has denied any involvement in the attack and has called for an independent investigation.
What happens next? Pakistan’s Prime Minister Shehbaz Sharif has called a national security committee meeting, while India’s Prime Minister Narendra Modi chaired a cabinet meeting. Pakistan has closed its airspace and shut schools in the part of Kashmir it administers, in the capital Islamabad and throughout Punjab. “There will be retaliation of some kind by Pakistan in the coming hours,” said an Indian international affairs analyst. We’ll bring you the latest updates here.
Here’s what else we’re keeping tabs on today:
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Interest rates: The US Federal Reserve and Brazil’s central bank announce interest rate decisions. Earlier, China said it would cut its benchmark rate as the US-China trade war begins to hit the country’s vast manufacturing sector.
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Economic data: Brazilian statistics agency IBGE is scheduled to release the country’s industrial output figures. The country’s April trade balance figures are also due. Separately, Chile’s trade balance data for April will also be released.
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Results: DoorDash, which yesterday announced a £2.9bn deal to take over rival Deliveroo, reports, as do Arm, Disney, New York Times, Beyond Meat and Uber.
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Conclave: Tensions over the late Pope Francis’s legacy loom as cardinals gather to elect the next leader of the world’s 1.4bn Catholics.
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Xi in Moscow: China’s president is on a four-day trip to Russia for Victory Day and talks with Vladimir Putin.
How should central banks navigate the new world order? Pose your questions about monetary policy to Chris Giles and other FT experts, and have them answered in a live Q&A today.
Five more top stories
1. Washington and Beijing will this week hold their first trade talks since Trump imposed tariffs on China. Treasury secretary Scott Bessent and US trade representative Jamieson Greer will meet China’s vice-premier He Lifeng in Geneva. Here’s what to expect ahead of the talks.
2. PwC is laying off about 1,500 employees in the US, becoming the latest Big Four firm to make cuts in the wake of historically low staff turnover. The cuts amount to 2 per cent of PwC’s US workforce and were concentrated in the audit and tax businesses. Here’s more on the cuts.
3. Israel has allowed hundreds of Palestinians to leave Gaza in recent weeks after months of a near-total block on departures. Diplomats fear the exits are the start of a plan — proposed by Trump in February — to empty the Palestinian enclave of its inhabitants.
4. US companies are planning to buy back a record $500bn of their own shares, as they seek to deploy their huge cash piles at a time when President Donald Trump’s policies are adding to uncertainty over making capital investments. Rising buybacks are a reflection of “global tariff uncertainty getting in the way of planning for operational investment,” said one investment banker.
5. Amazon’s self-driving start-up Zoox will scale up production next year as it accelerates plans for a commercial rollout of its fleet of robotaxis in the US. The company, which makes and operates a bespoke pod-shaped vehicle without a steering wheel, will open a new site in California’s Bay Area, its co-founder told the FT.
News in-depth
The high-stakes encounter between Donald Trump and Mark Carney yesterday in the White House had the potential to descend into a public spat along the lines of the infamous February encounter between the US president and Ukraine’s President Volodymyr Zelenskyy. In the event, it was the US president doing the flattery.
We’re also reading . . .
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Doge: By his own metrics, Elon Musk’s government cost-cutting drive has failed, writes Edward Luce. Was there a hidden method to the madness?
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Germany: The defeat of Friedrich Merz in the Bundestag’s first round of voting yesterday shattered something newly elected chancellors prize most: authority.
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Argentina’s copper rush: Mendoza is the source of 80 per cent of Argentina’s wine but the region is preparing to exploit the even more valuable red commodity.
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Resilient coffee: As climate change puts pressure on supplies, new varieties are coming to the fore, writes Anjana Ahuja.
Chart of the day
The old US-led economic order is now unsustainable, writes Martin Wolf. America will no longer serve as balancer of last resort, and the world — especially China and Europe — has to think afresh.
Take a break from the news
At this year’s Met gala, many didn’t just follow the “Tailored for You” dress code issued by the museum. They embodied its meaning and did not neglect to make a cultural point too. Here are the most striking outfits from what’s often called fashion’s biggest night.
Read the full article here