FirstFT: House to vote on Ukraine aid

Stay informed with free updates

Simply sign up to the World myFT Digest — delivered directly to your inbox.

Good morning.

The Speaker of the US House of Representatives Mike Johnson has said the chamber will vote this week on Ukraine and Israel aid, a move that could end months of inaction over support for Kyiv.

Johnson made his proposal for votes on four separate bills, including funding Taiwan and another that would impose more sanctions on Iran and allow Ukraine to cash in on profits from frozen Russian assets.

“We have terrorists and tyrants and terrible leaders around the world like [Vladimir] Putin and Xi [Jinping] and in Iran, and they are watching to see if America will stand up for its allies and our own interests around the globe, and we will,” Johnson said after his meeting with fellow House Republicans yesterday evening. Here are more details on his proposals.

Johnson’s intervention comes as the US and its European allies have stepped up efforts to dissuade Israel from striking back against Iran. US secretary of state Antony Blinken and UK Prime Minister Rishi Sunak both said western countries were preparing sanctions on Tehran in an attempt to prevent escalation into a full-blown Middle East war.

Israel’s war cabinet is to meet later for a third consecutive day to consider its response to Iran’s weekend attack. Israel’s military chief, Herzi Halevi, last night appeared to indicate that there would be an Israeli retaliation.

• Arab balancing act: Jordan is facing scrutiny at home for helping to repel the Iranian drone and missile attack on Israel.

• Market reaction: US stocks slid and equity market volatility hit a six-month peak following Iran’s military strike on Israel.

• Opinion: Why are energy and stock markets becoming less sensitive to geopolitical events, especially in the Middle East? Engine AI’s Robert Buckland explains.

Here’s what else I’m keeping tabs on today:

• Economic data: The IMF releases its World Economic Outlook, along with the first chapter of its global financial stability report ahead of the start of its Spring Meeting tomorrow.

• Canada: Finance minister Chrystia Freeland will present the country’s 2024-25 budget to parliament.

• Monetary policy: Federal Reserve chair Jay Powell and vice chair Philip Jefferson will make what are likely to be their last public comments before the US central bank’s next policy meeting on May 2-3.

• Companies: LVMH reports its first-quarter sales as succession plans at the world’s biggest luxury group speed up. Bank of America, Johnson & Johnson and Morgan Stanley report earnings.

Five more top stories

1. China’s economy grew by 5.3 per cent in the first quarter against a year earlier, beating a 4.6 per cent forecast in a Reuters poll and last year’s expansion of 5.2 per cent. “Generally speaking, the national economy got off to a good start in the first quarter . . . laying a good foundation for achieving the goals and tasks for the whole year,” the National Bureau of Statistics said. Here are more details from this morning’s official release.

• Opinion: The pace of China’s post-pandemic development should be a wake-up call for western manufacturers, writes Thomas Hale.

• Chinese business: After a boom in the mainland, bubble tea chains are looking to expand overseas, with groups such as ChaPanda, Mixue and Guming eyeing stock market listings.

2. Exclusive: Microsoft has agreed to invest $1.5bn in Abu Dhabi artificial intelligence group G42, its latest big bet on the technology that underscores deepening collaboration between the US and United Arab Emirates. The agreement comes after G42 severed its links to Chinese hardware suppliers, which had been the subject of scrutiny by US lawmakers. Here are more details on the deal.

3. Asian emerging market currencies are coming under pressure from a surging dollar, as tensions escalate in the Middle East following Iran’s attacks on Israel and expectations grow that the Federal Reserve will delay rate cuts. Indonesia’s central bank intervened to support the rupiah earlier today, while the Indian rupee slumped to a record low. In addition, the Korean won fell to a 17-month low and the Malaysian ringgit was trading close to a 26-year low. Central banks in the region are considering raising interest rates in response to the currency moves.

4. Exclusive: EY’s audits of collapsed payments group Wirecard were “at the very least” negligent and in some cases grossly negligent, according to people with direct knowledge of the details of an investigation by the German audit watchdog, Apas. While the assessment is unflattering, it has been greeted with relief inside the Big Four firm, said people familiar with internal discussions. Here’s why.

5. Exclusive: Austria’s Raiffeisen Bank International recently posted dozens of advertisements for Russia-based jobs indicating ambitious plans to expand in the country, in apparent contradiction to its official pledge to exit the market. The Financial Times has found the offers among more than 2,400 job advertisements posted in Russia by the Austrian lender since December. Raiffeisen said the FT’s findings have prompted its chief executive to order an immediate inquiry. Read the full story.

The Big Read

The collapse of Silicon Valley Bank, the forced sale of Credit Suisse and repeated turbulence in the US Treasury market are all recent disruptions that can be explained as the product of particular circumstances. Yet they all reflect profound long-run changes in the role and structure of the world’s financial system from the postwar era. The old financial certainties are vanishing, and new ones are yet to replace them. 

We’re also reading . . . 

• War in Ukraine: “There is no confidence in tomorrow,” a resident in the eastern city of Myrnohrad says, as Russia’s forces slowly advance.

• Abortion: Democrats are trying to capitalise on Arizona’s ruling to uphold a 160-year-old law by blaming Donald Trump, writes Lauren Fedor.

• CVC Capital Partners: After calling off previous attempts to list in Amsterdam and two years of on-and-off talks, one of Europe’s largest private equity groups is finally going public.

Chart of the day

Apple lost its lead in the global smartphone market to Samsung in the first quarter of the year as iPhone sales fell 10 per cent. But the strongest growth came from two lower-cost Chinese manufacturers, in the latest indication of Apple’s struggles in the world’s largest smartphone market.

Take a break from the news

Trillions of cicadas are set to emerge from years of slumber in the US Midwest for a once in a 221-year event. FT columnist Patti Waldmeir, who lives in Illinois, spoke to insect lovers from British Columbia to Japan who are travelling to middle America for this natural phenomenon dubbed “Cicada-geddon”.

Additional contributions from Benjamin Wilhelm and Nora Redmond