Good morning. We start with a major cabinet shake-up in Russia that suggests Vladimir Putin is dissatisfied with the handling of the war in Ukraine.
Russia’s president has moved Sergei Shoigu, the defence minister since 2012, to become head of Russia’s security council, the upper house of parliament announced yesterday. Shoigu had previously been seen as a near-untouchable figure thanks to his closeness to Putin and for his success in seeing off the challenge from a mutiny by mercenary leader Yevgeny Prigozhin last year.
Andrei Belousov, a deputy prime minister and longtime economic adviser to Putin, is to replace him, while Nikolai Patrushev, a hawkish former spy and one of Putin’s closest aides who has led the security council since 2008, will take up an unspecified new position. Here’s why Putin has made the biggest shake-up of his security officials in a decade and a half.
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Andrei Belousov: The appointment of a pliant, technocratic, Soviet-trained economist with no military background as defence minister marks a major shift.
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Military briefing: Russian forces have pushed further into Ukraine’s north-eastern Kharkiv region, in a move aimed at drawing Kyiv’s troops away from the eastern frontline, analysts say.
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Inside Business: Austrian lender Raiffeisen, which has continued to make big profits in Russia after the invasion, has been a rogue operator for too long, writes Patrick Jenkins.
Here’s what I’m keeping tabs on today:
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UK: Ahead of elections, Prime Minister Rishi Sunak will promise “bold ideas” for a Britain “at a crossroads” in a speech in London. The Chartered Institute of Personnel and Development has its labour market outlook.
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Europe: German Chancellor Olaf Scholz will discuss security issues and the war in Ukraine with his Nordic counterparts in a visit to Sweden, while French President Emmanuel Macron hosts an international business conference in Versailles aimed at attracting foreign investment.
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Bill Hwang trial: The founder of Archegos is set to appear in a Manhattan court on fraud charges for his role in the collapse of the $36bn fund.
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Companies: Bridgestone and SoftBank report results, while 888 Holdings shareholders will vote on changing its name to “Evoke” at the company’s annual meeting.
Five more top stories
1. Exclusive: The owner of Pret A Manger and Krispy Kreme is pivoting to insurance after its consumer and food empire has struggled in recent years. JAB Holding will announce today that it has hired Anant Bhalla, a US-based insurance veteran, to become its chief investment officer and a senior partner to build its new insurance platform. Read the full story.
2. The value of bids for London-listed companies this year has exceeded $78bn, the highest level since 2018, with the majority coming from overseas buyers. Targets have so far ranged from big international companies such as miner Anglo American to groups including International Distributions Services, the owner of Royal Mail. Here’s why dealmaking is recovering in the UK.
3. The US shale oil industry faces a barrage of lawsuits alleging some of its largest companies colluded to constrain production, after similar claims were made by US antitrust regulators. At least 10 class actions allege the groups conspired to drive up petrol prices. Here are some of the companies named in the lawsuits.
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Climate targets: Emissions reduction goals at BP and Shell have worried shareholders, but research by the Financial Times shows such targets need not impede returns, writes Matthew Vincent.
4. Exclusive: Chinese authorities have kicked off plans to sell Rmb1tn ($140bn) of long-dated bonds as policymakers raise spending to stimulate the economy. The People’s Bank of China has asked brokers for advice on pricing the sale of the first batch of sovereign bonds, according to people who received requests. Cheng Leng has more details on Beijing’s move.
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‘Transnational repression’: Chinese students abroad have accused Beijing of harassment and intimidation, including photographing them at protests and pressuring family members back home.
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Luxury ambitions: China wants to turn Hainan, a tropical island province roughly the size of Belgium, into the world’s largest duty-free shopping zone to stimulate its lagging economy.
5. Israel battled Hamas in northern Gaza yesterday after ordering tens of thousands more people to flee Rafah as it expanded its assault on the densely populated southern city despite international condemnation. The UN estimates that about 300,000 people have fled Rafah since Israel sent ground troops to the eastern edge of the city on May 6 and seized the border crossing with Egypt. We have the latest updates on the war.
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Biden’s gamble: The US president paused a weapons shipment to Israel, piling pressure on Benjamin Netanyahu to change course. Will it work?
The Big Read
Europe’s economic underperformance has surged to the top of policymakers’ agenda as the gap with the US has widened further following the twin shocks of the Covid-19 pandemic and Russia’s war in Ukraine. French President Emmanuel Macron has warned that Europe faces a “mortal” threat from economic decline. With deep-seated problems in its economy, can the region ever hope to rival America again?
We’re also reading . . .
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Interest rates: An easing of Eurozone monetary policy before the US could raise the cost of imported goods and services, writes Mathilde Lemoine of Edmond de Rothschild.
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EVs as job perks: More employers are allowing staff to lease electric vehicles for personal use through salary sacrifice schemes, driving up EV sales in the UK.
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GPS warfare: Military activity has driven a surge in jamming and spoofing incidents, affecting civilian smartphones, planes and vessels on three continents.
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Musk and HR: The billionaire’s firings offer lessons on assessing staff correctly and fairly, and eliminating bias, writes Anjli Raval.
Chart of the day
In the UK in 1965, the most common age of death was in the first year of life. Today the most common age to die is 87 years old. In his latest column, Martin Wolf explores the profound social changes that increased longevity will bring — not just the challenges of an “ageing” society, but its opportunities.
Take a break from the news
The BBC’s time-travelling sci-fi series Doctor Who is a British cult classic, and its instantly recognisable theme song is equally iconic. Like the Doctors, the piece has lived multiple lives, writes David Honigmann. Listen to the remixes by musicians such as Pink Floyd and Hank Marvin in this week’s Life of a Song column.
Additional contributions from Benjamin Wilhelm
Read the full article here