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Good morning and welcome back. In today’s newsletter:
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US halts plans to impose sanctions on China’s Ministry of State Security
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Bond investors worry about Kevin Hassett’s Fed chair candidacy
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How a boom in satellites is hindering astronomers
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And the FT & Schroders Business Book of the Year winner
We start with the Trump administration and its plans to halt sanctions on China’s Ministry of State Security over a massive cyber-espionage campaign in order to avoid derailing the trade truce between President Donald Trump and President Xi Jinping.
What we know: Current and former US officials told the Financial Times that plans to impose sanctions on the Chinese spy agency were put on hold to avoid undermining the US-China détente struck in the South Korean city of Busan in October. Several people said the goal of the Trump administration’s China policy had shifted to ensuring “stability” until the US reduces China’s dominance in rare earths. Trump also does not want to jeopardise his visit to Beijing in April, the people said.
Why it matters: The decision not to impose sanctions over Salt Typhoon, which has successfully targeted the unencrypted communications of top US officials, has sparked frustration among China hawks in the government who think Trump is sacrificing national security for trade deals. The administration is also preparing to hold a high-level meeting to decide whether to provide licences to allow Nvidia to export the H200 advanced chip, another concern for China hawks. Read the exclusive story by Demetri Sevastopulo.
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Economic data: The Labor Department will release weekly jobless claims a day after figures from payroll processor ADP showed more than 30,000 US jobs were lost in November. The Commerce Department is set to release factory orders and durable goods orders for September. Brazil’s statistics agency publishes third-quarter GDP data.
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Results: Jack Daniel’s maker Brown-Forman reports interim results while retailers Kroger and Dollar General publish third-quarter figures. Hormel Foods releases annual numbers.
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US Federal Reserve: Vice-chair for supervision Michelle Bowman speaks virtually on “Bank Supervision and Regulation” before the Florida Bankers Association Leadership Luncheon.
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Russia-India relations: President Vladimir Putin arrives in New Delhi today for his first visit to the country since December 2021, as Trump’s special envoy Steve Witkoff and the president’s son-in-law brief Ukrainian officials in Miami after their meeting with the Russian president earlier this week.
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Congress: Admiral Frank Bradley, head of the Joint Special Operations Command, who oversaw the recent military operation that led to the killing of 11 suspected drug traffickers in the Caribbean, will appear at a closed-door meeting with lawmakers.
How is Donald Trump reshaping globalisation and world trade? Submit your questions to our experts and take part in our live Q&A today at 9.15am ET.
Five more top stories
1. Exclusive: Bond investors have told the US Treasury they are concerned about Kevin Hassett’s potential appointment as Federal Reserve chair. The Treasury department solicited feedback on Hassett and other candidates in one-on-one conversations with executives at major Wall Street banks, asset managers and other big players in the US debt market, according to several people familiar with the conversations. Here’s more on what the market participants said.
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More market news: Yields on Japan’s benchmark government bonds today rose to their highest level since 2007 as investors fretted over Prime Minister Sanae Takaichi’s spending plans and braced themselves for an interest rate increase.
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Sterling: The pound jumped against the dollar as stronger economic activity triggered an unwinding of negative bets against the UK currency.
2. The European Commission is planning a new antitrust investigation into Meta over the rollout of artificial intelligence features within its popular messaging service WhatsApp, in the EU’s latest challenge to Big Tech. Read more on the expected probe.
3. The Pentagon’s watchdog ruled defence secretary Pete Hegseth put American troops at risk and violated department policy when he shared plans for strikes against Houthi rebels in Signal chats in March. Here’s more on the classified report.
4. One of the largest middlemen in First Brands’ financings has said that “a lot of people made a lot of money” lending to the bankrupt car parts maker. The comments, made at a conference in New York, came as a Houston bankruptcy court looks to untangle a web of obligations asset managers claim they are owed from First Brands and its customers.
5. The Arab region was being pushed to its limits by intense heatwaves and severe droughts, the latest World Meteorological Organization report found, as it warms at twice the global average. The study found extreme events last year affected 3.8mn people.
Today’s Big Read
The Taliban flag is adjusted at the Afghan embassy in New Delhi. © FT montage/Getty
When the Taliban returned to power in 2021, many countries severed all ties with the new government. But over the past few months, Afghanistan’s Islamist regime has begun to emerge from diplomatic isolation. The Taliban is now recognised by Russia, sends diplomats to Europe and has even enjoyed occasional praise from the US. The Taliban, whose senior leadership remains under UN and western sanctions, hopes these moves will translate into much-needed economic aid. Read more on the rise of Taliban 2.0.
We’re also reading and listening to . . .
Chart of the day
A boom in satellites is brightening the night sky and hindering astronomers’ ability to study distant galaxies. Planned spacecraft launches are surging and will degrade images from major space observatories including the Hubble telescope, according to research from Nasa scientists. The findings highlight how a lack of international rules threatens crucial astrophysical measurements taken from both Earth and outer space, writes science editor Michael Peel.
Take a break from the news . . .
Stephen Witt’s The Thinking Machine, which tells the inside story of how Nvidia became the world’s most valuable corporation, was last night awarded the Financial Times and Schroders Business Book of the Year prize. Judges praised the “unique insights” into the success of Jensen Huang and Nvidia.
Television producer and investigative journalist Stephen Witt wins £30,000
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