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The Bipartisan Policy Center estimates that the so-called X-date could fall between mid-July and early October if Congress does not lift or suspend the nation’s debt limit.The United States could run out of cash to continue paying its bills by mid-July if Congress does not take action to raise or suspend the nation’s debt limit, according to an analysis on Monday by the Bipartisan Policy Center.That deadline, known as the “X-date” — the moment when the United States is unable to meet its financial obligations and might default on its debt — is a fiscal milestone that’s among the most closely watched in Washington and on Wall Street.The date is subject to considerable uncertainty. It relies on estimates of how much wiggle room the Treasury has to use accounting maneuvers — known as “extraordinary measures” — to keep paying the government’s bills by shifting money around. The Bipartisan Policy Center, a think tank, provided estimates suggesting that the X-date could come as late as the beginning of October.Efforts to address the debt limit will likely consume Congress and the Trump administration later this year as Republicans race to enact trillions of dollars of tax cuts.The debt limit is a cap on the total amount of money that the United States is authorized to borrow to fund the government and meet its financial obligations.Because the federal government runs budget deficits — meaning it spends more than it brings in through taxes and other revenue — it must borrow huge sums of money to pay its bills. Those obligations include funding for social safety net programs, salaries for members of the armed forces and paying investors who have bought U.S. government debt in exchange for interest payments.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

This article is an on-site version of our Europe Express newsletter. Premium subscribers can sign up here to get the newsletter delivered every weekday and Saturday morning. Standard subscribers can upgrade to Premium here, or explore all FT newslettersGood morning. Donald Trump’s yearning for Greenland is back in the news: Mike Waltz, the US national security adviser, and energy secretary Chris Wright will travel to the Danish Arctic island later this week and tour Pituffik Space Base, in what officials are billing as “a private visit”.Yesterday in Saudi Arabia, US and Ukrainian negotiators resumed talks over a potential peace deal. Below, I explain why subsequent US-Russia talks today over the Black Sea are making European capitals nervous, and Laura lays out why the mass protests sweeping Turkey are problematic for Brussels.Tomorrow, I’ll interview European Commission technology chief Henna Virkkunen on stage at the Financial Times’ event on Enabling Europe’s AI Ambitions in Brussels, alongside top FT colleagues and senior officials and experts. Register here to attend for free, or watch online.Murky watersEurope’s Black Sea states are watching on nervously as US-Russia peace negotiations over Ukraine continue today in Saudi Arabia, fearful of a possible deal that would restore some of Moscow’s clout over the contested waters.Context: US President Donald Trump has demanded a rapid end to the war in Ukraine and opened bilateral negotiations with both Moscow and Kyiv in a bid to find a framework for a peace deal. European countries are not directly involved in the discussions.Negotiators from Moscow and Washington will discuss Black Sea safety and a potential resumption of export lanes in Riyadh today, with the intention of tying a naval deal to a wider peace agreement.Mike Waltz, Trump’s national security adviser, said yesterday the talks would focus on “a Black Sea maritime ceasefire so that both sides can move grain, fuel and start conducting trade again in the Black Sea”.EU littoral states Romania and Bulgaria are wary of any significant changes to the status quo in the Black Sea as part of any broader potential agreement between Russia and the US, officials from the region told the Financial Times, given that it would expand the Russian navy’s operational area.Ukraine has successfully driven Russia’s navy out of the western part of the sea, in one of Kyiv’s most striking military achievements of the more than three-year-long war. Any agreement negotiated is thus expected to be beneficial to Moscow, the officials said, and could affect their countries’ security without giving them a say.“This is our neighbourhood and we don’t trust the Russians if they are allowed more freedom to operate,” said one of the officials.US and Russian officials have described today’s talks as “technical”, involving mid-level officials rather than senior politicians. Still, Trump’s top Russia envoy Steve Witkoff yesterday seemed pretty bullish.“I think that you’re going to see in Saudi Arabia on Monday some real progress, particularly as it affects a Black Sea ceasefire on ships between both countries,” he told Fox News.Chart du jour: TakeoverSome content could not load. Check your internet connection or browser settings.Elon Musk’s ties to Donald Trump are becoming a hindrance to the global rollout of Starlink — as showcased by his recent unsuccessful efforts to salvage a $1.5bn deal with Italy.Danger signsThe EU has warned Turkey not to stray from democratic standards after the arrest of President Recep Tayyip Erdoğan’s main challenger and hundreds of protesters, writes Laura Dubois.Context: Last week, Istanbul mayor Ekrem İmamoğlu was detained by police on corruption and terrorism charges, triggering mass protests. It is the first time such a senior member of the main opposition Republican People’s party (CHP) has been detained under Erdoğan’s longtime rule.Yesterday, a court ruled that İmamoğlu should remain in jail awaiting trial, a decision which he called a “black stain on democracy”. The government has also banned demonstrations in some cities and detained more than 600 protesters around the country since Friday.These moves put the EU in an awkward position, at a time when Brussels is seeking closer ties with Ankara in the face of threats from Russia and an indifferent US.Next month, the EU and Turkey are slated to hold a high-level economic dialogue for the first time since 2019, when relations soured over Ankara’s unauthorised drilling operations in the eastern Mediterranean.But the arrest of İmamoğlu, who denies wrongdoing and previously announced he wants to challenge Erdoğan to the presidency, has forced Brussels to react.EU foreign affairs spokesperson Anitta Hipper said yesterday that the arrests of İmamoğlu and the protesters “give rise to questions regarding Türkiye’s adherence to its long-established democratic tradition”.Hipper said that as an EU accession candidate, “Türkiye must uphold democratic values”.“The rights of elected officials, as well as the right for peaceful demonstrations need to be respected,” she warned.What to watch today EU chief diplomat Kaja Kallas visits Israel and Palestine.Meeting of EU agriculture and fishery ministers in BrusselsInformal meeting of EU health ministers in Warsaw.Lithuania’s Prime Minister Gintautas Paluckas meets his Estonian counterpart Kristen Michal in Tallinn.Now read theseFinancial crisis redux: Top EU financial watchdogs have told the FT that watering down regulations risks another economic meltdown.Nuclear option: Trump’s pivot to Moscow and disregard for Nato threatens the consensus on non-proliferation of nuclear weapons. Keep it flowing: Kyiv has called on the EU to renew a trade deal lifting duties and quotas on Ukrainian exports, or risk “really damaging” consequences.Recommended newsletters for you Free Lunch — Your guide to the global economic policy debate. Sign up hereThe State of Britain — Peter Foster’s guide to the UK’s economy, trade and investment in a changing world. Sign up hereAre you enjoying Europe Express? Sign up here to have it delivered straight to your inbox every workday at 7am CET and on Saturdays at noon CET. Do tell us what you think, we love to hear from you: [email protected]. Keep up with the latest European stories @FT Europe More

Unlock the Editor’s Digest for freeRoula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.The writer is group chief economist at Société GénéraleLong bond yields in the Eurozone have risen sharply on the back of the “whatever it takes” fiscal measures presented by Germany’s chancellor-in-waiting, Friedrich Merz, on March 4. The benchmark 10-year Bund yield has jumped by about 0.25 percentage points since then.The sell-off is warranted by fundamentals, given expectations for significantly stronger economic growth and government bond issuance. This is not true elsewhere in the region, where similar scaled debt-financed spending measures are not in the pipeline.The welcome German measures won final approval last Friday, with relatively low import content from other euro area member states. As such, positive spillover from stronger German growth to the rest of the region is likely to be modest and is potentially even in danger of being more than offset by the sharp rise in bond yields. Soaring bond yields also add to governments’ debt servicing costs, adding to the challenges for member states in need of fiscal consolidation.It is further worth noting that euro area bond yields are now around the levels that prevailed last June, just before the European Central Bank embarked upon its current monetary policy-easing cycle, which has now led to 1.50 percentage points of cuts to its key deposit rate. There is thus an argument to be made that euro area member states, outside Germany, are experiencing an “unwarranted” increase in bond yields. Zooming in on the major 10-year benchmark bond yields in the France, Italy and Spain, these have increased by about 0.25 percentage points since the announcement of the German measures. The ECB’s toolkit has since the euro area debt crisis been expanded to deal primarily with unwarranted widening of euro sovereign bond yields relative to the German benchmarks, with notably the Outright Monetary Transactions and the Transmission Protection Instruments schemes. Neither tool has been used, but there is little doubt about their effectiveness.OMT is the 2012 scheme to buy government bonds in potentially unlimited amounts if needed. It was the delivery on Mario Draghi’s July 2012 promise to do “whatever it takes” to preserve the euro as the then-ECB president. TPI, introduced in July 2022 in what Christine Lagarde, his successor, called a “historic moment”, marked a further addition to counter disorderly market dynamics. It allows the ECB to buy the bonds of a Eurozone country if is suffering from an increase in its borrowing costs beyond the level justified by economic fundamentals.Some content could not load. Check your internet connection or browser settings.In theory, the TPI could be activated to counter the recent rise in bond yields in member states outside Germany, but this seems both unlikely and suboptimal. The TPI is widely understood to be a tool to counter disorderly spread movements in jurisdictions under market pressure and comes with the conditionality of respecting European fiscal rules. Using the tool outside this context may lead to market confusion.And further rate cuts could prove a blunt instrument, if such moves were to merely to steepen the German bond yield curve, widening the gap between shorter and longer interest rates. Likewise if rate cuts steepened the yield curve farther by raising growth and inflation expectations in Germany.There is thus a case to be made for a tool to deal with an unwarranted rise in long euro area bond yields that is driven by the de facto anchor for this market, Bunds.Pausing so-called quantitative tightening — the unwinding of the long-running programme of bond buying to lower the costs of borrowing in order to stimulate the economy — could mark a first step. That could ease upside pressures on the premiums placed on longer-term bonds across the euro area over short-term debt.A speech by ECB executive board member Piero Cipollone last month discussed the right balance for the ECB’s balance sheet and its implications for monetary policy. He cited survey data suggesting the potential for a greater impact from QT on Spain and Italy, compared with France and Germany, in lifting bond yields. If accurate, this asymmetry offers a case to pause QT. A further avenue for the ECB involves its Pandemic Emergency Purchase Programme, a temporary asset purchase programme of private and public sector securities buying to offset the shock of the outbreak of Covid-19 in 2020. The ECB is letting those purchases “run off”, not reinvesting proceeds from maturing bonds. The central bank has said this process will be managed “to avoid interference with the appropriate monetary stance”. It may be time to consider that, at least pausing PEPP run-off outside Germany.  More

Unlock the Editor’s Digest for freeRoula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.The risk of a global trade war is “a very big concern” that would damage the world’s ability to tackle rising temperatures by limiting access to crucial technology, the chief executive of this year’s UN COP30 climate summit has warned.Brazil is due to host the world’s most important environmental talks in November, but the country’s climate secretary Ana Toni admitted they would take place in “very difficult circumstances”.Since taking office in January, President Donald Trump has launched a sweeping attack on climate policies in the US, including pulling the country out of the landmark Paris agreement for the second time, while his threatened tariffs have sparked fears of a global trade war.“The trade war is a really big concern because some countries have technology for decarbonisation that other countries need,” Toni said in an interview with the Financial Times. “We cannot slow down the process because of trade wars in terms of exchanging technologies, products and so on.”A London School of Economics paper last year found that Trump’s promised tariffs would “significantly impact the affordability of electric vehicles” in the US alone. “Having fluid and free trade for specifically low carbon products is really important,” Toni said. “So trade wars don’t help us. They really make our lives harder for the process that we need to face, which is global decarbonisation.”Academic research suggests duplicate supply chains caused by tariffs can increase emissions, but bolstering domestic manufacturing can also cut demand for heavily-polluting long-haul shipping.Toni argued there was still widespread support from countries outside the US for addressing climate change, adding that the UK, Europe and China all supported a “multilateral approach”.“We have to have a successful COP” despite the geopolitical turmoil, Toni said. “Climate change is not going to wait for the geopolitical scenery to change.”She said this year’s COP needed to shift away from a focus on negotiations — arguing the “rule book” for the Paris accord was now largely agreed — and instead focus on how to “accelerate action”.She noted that the summit, which will take place in the Amazonian port city of Belém, will be the first held “since we’ve gone over 1.5C” above pre-industrial levels over a calendar year.This is not a breach of the Paris agreement’s goal to limit the temperature rise to 1.5C above the pre-industrial period, which is measured over decades rather than one year, but scientists warn last year’s record-breaking temperatures signalled that climate change was accelerating faster than expected.Brazil’s leadership of the COP conference has come under scrutiny in recent months, with criticism of its decision to explore for more oil, join the OPEC+ oil group and allow the construction of a road through forest in Belém.Despite being a big oil producer, Brazil is “going to do this transition” away from fossil fuels, Toni said, arguing their membership of OPEC+ could help drive dialogue about reducing nations’ dependence on oil and gas.She also played down concerns about deforestation caused by the construction of the road in Belém. The road was not being built specifically for the summit, she said, insisting it was instead infrastructure required for the city.“No one is proud to deforest even one tree but sometimes it is needed.”Climate CapitalWhere climate change meets business, markets and politics. Explore the FT’s coverage here.Are you curious about the FT’s environmental sustainability commitments? Find out more about our science-based targets here More

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Unlock the Editor’s Digest for freeRoula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.Europe’s drive to simplify and streamline financial regulation is making top supervisors nervous about the risk of key safeguards being watered down. Two of the EU’s most senior financial supervisors told the Financial Times they were determined to avoid crisis prevention measures being swept away in the push to revive the region’s sluggish economic growth.“If it is about deregulating and lowering the bar on financial protections, we will not be ready to tackle volatility.’’ said Dominique Laboureix, head of the Single Resolution Board — which handles failing Eurozone banks. ‘‘That means crises, which means less growth.” The pointed intervention, which is uncommon for the watchdogs, comes after the European Commission recently announced plans to drastically cut the scope of business sustainability disclosure rules it introduced two years ago. It is also reviewing capital rules for banks and insurers as part of plans to boost financial market activity and growth.Some officials want Brussels to go further. The heads of the German, French, Spanish and Italian central banks wrote to the commission recently calling on it to remove “unduly complex” areas of financial rules that distort international competition without improving financial stability.Laboureix said he was “absolutely ready” to engage with calls for the burden of regulation to be eased. But he warned policymakers not to forget the lessons of the last big banking sector meltdown. “Don’t forget the 2008 crisis. What did that mean? Bailouts everywhere.”“I am ready to discuss simplification, but I am not ready to lower the bar in terms of protecting financial stability,” Laboureix said in an interview.Frank Elderson, vice-chair of the ECB supervisory board, pointed out that after the 2008 financial crisis Eurozone governments spent €1.5tn in capital support and €3.7tn in liquidity support for the financial system. Europe’s economy shrank 4.3 per cent in 2009 as the crisis took its toll.“It’s good to remember why we did that in the first place,” Elderson said in an interview, adding: “We need not be complacent and say the next decade will be rosy — so we have to be wary about doing away with supervisory functions that could lead to this situation repeating itself.”Elderson told a banking conference in London last week: “The debate on competitiveness should not be used as a pretext for watering down regulation.” Instead of lowering regulatory requirements he said the EU should focus on harmonising them across its 27 members. “Don’t cut rules, harmonise them,” he said.The ECB executive told the FT he supported “simplification in a nuanced way” of sustainability disclosure rules, but he warned if this went too far it could deprive banks of the information they need from companies to assess their own exposure to climate change risks.“Was all this perfect? Probably not,” he said. “Can we do better without paying too much of a price? Possibly.” But he added: “If it were to lead to banks not having the data they need to assess these risks, that would be a problem for banks and would make our work as a supervisor more difficult.”The ECB has been pushing Eurozone banks to address risks from floods, droughts, wildfires and the transition away from fossil fuels, threatening to fine those that drag their feet.The central bank has the power to impose “periodic penalty payments” on lenders worth up to 5 per cent of their average daily turnover every day for up to six months.Elderson said there were “a few banks” for which such penalties were still “a concrete possibility” after they missed the first of a series of deadlines to take steps to tackle climate risks in their balance sheets. “There are a small number” of other banks that have been told they could also face penalties for missing the ECB’s second deadline on climate action set for the end of 2023, he said. A final deadline expired so recently it is “too early to say” if any banks could be fined over this. More

Unlock the Editor’s Digest for freeRoula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.Japan has not yet beaten deflation despite years of persistently rising consumer prices and the largest round of annual wage increases in three decades, the country’s finance minister has warned.Katsunobu Kato’s blunt assessment in an interview with the Financial Times comes 15 months into the Bank of Japan’s efforts to “normalise” the economy and gradually reintroduce positive interest rates, after a quarter-century-long battle to steer the country away from falling prices.Kato acknowledged that Japan was experiencing rising prices and that other trends appeared positive, but said the government could only declare victory over deflation when it saw no prospect of sliding back.“I believe we need to judge carefully whether Japan has broken away from deflation by not only looking at the consumer prices, but looking at underlying prices and background in a comprehensive fashion . . . it is our judgment at present that Japan has not overcome deflation,” Kato said.The minister’s comments echo some economists’ fears that, while prices are rising, they largely represent the “wrong” type of inflation: driven by a weak yen and high commodity costs rather than a virtuous cycle of rising wages and consumer demand.Headline inflation has remained above the BoJ’s target of 2 per cent for 35 straight months, and consumer prices excluding fresh food rose 3 per cent in February from a year earlier. Some content could not load. Check your internet connection or browser settings.Last Friday, the Japanese Trade Union Confederation, which claims a membership of 7mn workers, said negotiations had resulted in average wage gains of 5.46 per cent, which it said was the highest pay bump in 33 years.But wage growth is stagnant in real terms, consumer confidence has remained soft and, according to the research group Teikoku Databank, companies in February were passing a smaller proportion of their increased costs on to consumers than they were last July.During the deflationary period, said Kato, there was no movement in prices, wages or interest rates — a combination that suppressed economic growth and prevented the country from realising its potential.“It was a very sluggish situation,” Kato said. “However, things are now changing. We are now seeing prices rising, wages rising and in terms of monetary policies, the BoJ is now looking into what the optimal monetary policy stance will be for Japan. So we are now seeing signs of change and normalisation.”Kato spoke to the FT shortly after the BoJ opted to leave the short term policy rate on hold last week because of the huge uncertainties created by US President Donald Trump’s tariff threats and the rising risks to the global economic picture.The BoJ’s normalisation process involved ending negative rates in early 2024, followed by a small rise in July that year. In January 2025, the BoJ lifted rates to 0.5 per cent — the highest level in 17 years. Many economists predict at least one more rise this year.The process of transition into a normal economy, said Kato, depended on ensuring that wage increases outpaced price increases over the long term.He said it was encouraging that larger companies were raising wages, but the real challenge was to ensure that Japan’s small and medium-sized companies were able to pass rising labour and input costs on to customers.Stefan Angrick, Japan economist at Moody’s Analytics, said that while the level of consumer price inflation seemed to rule out a return to deflation, Kato’s comments reflected the fact that Japan did not yet have the kind of inflation it wanted.“And it’s hard to feel very confident that it will,” said Angrick.The supply shock would eventually fade, he added, and then only stronger domestic demand could keep inflation on target. “But domestic demand is quite weak. Consumer spending has been flat for the past three years. Capex spending is treading water. Labour markets aren’t quite as tight as they seem,” said Angrick, who expects inflation to drop below 2 per cent by 2026. More