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Good morning. We begin with an exclusive story on EU plans to raise up to €40bn in loans for Ukraine without the US.
Brussels is preparing to provide the new financing by the end of the year regardless of US participation, after a G7 proposal to use frozen Russian assets to aid Kyiv faltered.
The unilateral push comes amid concern in Brussels that Hungary will prevent the bloc from delivering safeguards that the US needs for it to participate in the frozen assets scheme, according to three people involved in the talks.
The government of Viktor Orbán, the EU’s most pro-Russia leader, has sought to delay a decision on the frozen assets scheme until after the US presidential election on November 5.
But Brussels must start work on any alternative within the next few weeks since such a move would rely on powers that expire at the end of the year. Paola Tamma and Henry Foy have more on the draft proposal.
Here’s what else I’m keeping tabs on today:
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Economic data: ZEW publishes German economic survey results, Canada releases consumer price data and the US issues its monthly retail trade report.
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Book award: The Financial Times and Schroders Business Book of the Year shortlist is announced. Catch up on the longlist here.
Five more top stories
1. Exclusive: The US and Japan are close to a deal to curb tech exports to China’s chip industry despite alarm in Tokyo about Beijing’s threat to retaliate against Japanese companies. The new export controls include a measure forcing non-US companies to get licences to sell products to China that would help its tech sector. Read more on the discussions.
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US-China rivalry: The whole world risks losing from the competition between Washington and Beijing, writes Gideon Rachman.
2. Iran’s reformist president, Masoud Pezeshkian, has signalled a renewed openness to resuming nuclear negotiations with western nations and denied that his country had supplied ballistic missiles to Russia since he took office seven weeks ago. But increased tensions between Iran and Israel have made signing a fresh nuclear agreement even more complicated. Read the full story.
3. Exclusive: London-based Revolut is preparing to launch its services in India next year, targeting tens of millions of the country’s top-tier consumers in a crucial test for the growth strategy of Europe’s most valuable fintech. The company is on course to launch its app, domestic and multi-currency cards in the world’s most populous country as it seeks to expand its revenues outside Europe. Read more of the group’s plans.
4. Exclusive: SURJ, the sports investment firm owned by Saudi Arabia’s Public Investment Fund, has entered the sale process for EuroLeague, as Europe’s top basketball competition seeks to sell a minority stake at a €1bn valuation. But the sports group would have to contend against private equity group BC Partners, which is also seeking to expand its sports portfolio.
5. Fund managers have expressed concerns that takeover activity is narrowing the UK stock market. Thirty London-listed companies received firm takeover offers for an average value of £1bn in the first half of this year, data shows. But their removal, coupled with a shortage of IPOs to replace them, spells a worrying trend of fewer quality stocks investors can choose from.
The Big Read
Netflix has staged a remarkable recovery since the “great correction” of 2022, after launching a crackdown on password-sharing and investing into ads, video games and live “experiences”. While traditional entertainment companies struggle to make money after pouring billions into streaming, Netflix has expanded its lead thanks to its strategic shift.
We’re also reading and listening to . . .
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UK Budget: Rachel Reeves must show that she is serious about growth by making tough decisions on jobs, productivity and investment, writes former chancellor Jeremy Hunt.
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Women in prisons: The case of female prisoners should make us re-examine if incarceration is the solution for those who have been coerced into crime, writes Stephen Bush.
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The Economics Show 🎧: Soumaya Keynes grills Jared Bernstein, US President Joe Biden’s top economist, on price caps, jobs and inflation.
Chart of the day
Volkswagen, Germany’s largest private employer, is facing a crisis brought on by slowing demand, high costs and tough competition from Chinese start-ups. Plans to close some German factories have unleashed angst among inhabitants in VW’s hometown, where it employs 60,000 people. Our reporter sends a dispatch from Wolfsburg.
Take a break from the news
Among the many experiences in modern working life that can provoke ire and irritation, the panel discussion elicits a particular form of dread. But fear not: Viv Groskop has proposed a recipe for success so that your next panel isn’t ruined by droning participants or egoistic chairs.
Additional contributions from Benjamin Wilhelm and Gordon Smith