Flagship

Trump ratchets up trade tensions

US President Donald Trump said he may increase tariffs to levels above his “Liberation Day” duties, ramping up tensions days before a trade war reprieve expires. The White House will today send letters to about a dozen countries outlining their new tariff rates, and contact more in the coming days, with levies ranging from 10% to 70% — the latter figure being higher than any of Washington’s April duties. US tariff revenues skyrocketed to a record in May, new figures showed, the American economy has not yet suffered the stagflation many economists had warned of, and investors appear to have shrugged off downturn fears. Still, stocks fell and the dollar dropped following Trump’s remarks.

EU, China ties strained

Ties between Beijing and Brussels appeared increasingly strained, just weeks before a high-profile summit. China on Friday announced it would impose duties on brandy imported from the European Union — widely seen as retribution for the bloc investigating Chinese state subsidies for electric vehicles makers — and reportedly wants to scrap part of the upcoming summit. The pair had sought to steady their ties in the face of US trade pressure, but a recent visit by China’s foreign minister to Europe laid bare their huge differences on issues ranging from trade to the war in Ukraine: Beijing’s top diplomat told his European counterpart that China could not countenance Russian defeat, the South China Morning Post and La Matinale Européenne both reported.

LatAm’s East-West divide

​​Brazilian President Luiz Inácio Lula da Silva urged South America’s biggest trading bloc to focus on strengthening ties with Asia, risking the group’s unity. Asia is now the “dynamic center” of the global economy, Lula said, but other Mercosur members including Argentina have argued for prioritizing European and US ties, with Argentinian President Javier Milei threatening to leave the group if his demands are not met. The leaders’ dueling comments came ahead of a separate BRICS summit where Lula plans to defend free trade in the face of US protectionism, underscoring friction between Brasília and Washington. “We are in a moment of damage containment more than a moment of creating new instruments,” a Brazilian diplomat told The Economist.

Trump to sign spending plan

US President Donald Trump will sign the One Big Beautiful Bill Act into law today after it squeaked through Congress. Higher-income households will see reduced taxes, while many poorer ones will lose health insurance. Nuclear and geothermal energy projects will retain some subsidies, while those for renewables will be cut. That’s bad news for the data center industry, TechCrunch reported, which needs solar to rapidly add cheap energy, and for many Republican-voting states which have seen a renewables boom. Cuts to electric-vehicle incentives will hit Tesla, helmed by erstwhile Trump ally Elon Musk, who has vowed to retaliate. But drugmakers expect a multi-billion-dollar windfall after more medications were exempted from a federal price negotiation program.

US notes no progress on Ukraine peace

Kyiv said it would protest Washington’s abrupt halt of weapons deliveries during a call between the two countries’ leaders today, as peace efforts faltered. US President Donald Trump acknowledged he “didn’t make any progress” in talks with his Russian counterpart Thursday, telephone diplomacy that comes with no end to the conflict in sight. Moscow hammered several Ukrainian cities overnight in a drone and missile barrage, an attack Ukraine’s leader labeled “massive and cynical” for coming just as talks between the American and Russian presidents concluded. But while Washington’s tone toward the conflict has shifted — a prospective rapprochement with Moscow has given way to growing criticism — its withdrawal of military support has left Kyiv frustrated.

New flu drug outperforms vaccines

A single-shot drug outperformed vaccines in protecting people from seasonal influenza. Traditional flu vaccines are only about 40% effective, because they target a limited number of viral strains and are based on manufacturers’ guesses — often wrong — of which strains will be dominant that winter. The new antiviral drug, tested on 2,500 healthy adults, is broader-spectrum, and on a high dose reduces flu incidence by 76% compared to placebo, its manufacturer said. Flu causes significant misery: A bad flu season can see 50,000 deaths and hundreds of thousands of hospitalizations in the US alone, mainly among the elderly.

Africa startup financing surges

African startups raised nearly twice as much in the first half of 2025 as in the same period last year, signaling business interest in the continent may be reviving. Venture investment in Africa has declined for three consecutive years, with regional startups raising only $800 million in the first half of 2024, but that figure surged to $1.4 billion through June this year. The bar for success on the continent has increased, but so has “Africa’s ability to produce ventures of global calibre,” the African Private Capital Association said. Yet opportunities for startups to exit remain scant, with the number of public market listings falling steadily from its 2022 peak.

Jane Street barred by India

India’s securities regulator suspended the trading house Jane Street, accusing it of market manipulation. The watchdog said the Wall Street firm made trades “without any plausible economic rationale” that artificially influenced the value of the country’s benchmark stock index, allegations Jane Street denied. The move is further bad news for the algorithmic-trading firm, whose CEO said last month he was duped into financing an alleged plot to overthrow South Sudan’s government. It also points to both the growing appeal of India’s finance sector — global trading firms have been expanding aggressively in the country — and efforts by Indian officials to crack down in particular on algorithmic trading, which regulators last year argued drives heavy losses among retail investors.

Britain mulls AC

Rising temperatures in the UK are driving calls for an expansion of air conditioning. Even by European standards, Britain has low uptake of AC, and environmentalists worry about the impact of growing power use on carbon emissions. But as the country warms, “Britain’s image of summer has not caught up with its sweaty reality,” The Economist’s Bagehot columnist noted, with 30°C (86°F) days increasingly common. AC is seen as “an absurd luxury,” but boosting its use would help level out Britain’s electricity demand, one analyst wrote: It is most needed when solar energy is most abundant. The rise of AC elsewhere is credited with driving economic growth. Lee Kuan Yew, Singapore’s founding father, said it made his country’s development possible.

H&M releases AI model images

H&M released its first set of images using artificial intelligence models — as in, good-looking people who are paid to advertise clothes, not large language models. The clothing retailer used real-life human models to create virtual “twins” which the firm could then digitally dress in a variety of products. A company executive said the human models would have creative control over their AI counterparts, and that the system is “not here to replace everyone.” Pretty obviously, though, they will need to use fewer humans to create the same number of fashion shots. H&M said its “exploration and… reimagining of the creative process [remained] deeply rooted in our human-centric mindset and style-led identity,” although what that means is anyone’s guess.

• European Union leaders are due to meet Moldova’s president to discuss the country’s future EU membership.
• Argentina’s President Javier Milei hosts Indian Prime Minister Narendra Modi in Buenos Aires.
• The US celebrates its Independence Day.

The drop in the number of performances at this year’s Edinburgh International Festival compared to last year’s. The festival is one of Britain’s most important cultural institutions, but a campaign last year led to it and other arts events dropping sponsor Baillie Gifford over the firm’s links to Israel and the fossil fuel industry. As a result, other companies have been reluctant to come forward as sponsors, and despite the government stepping in with greater funding, several festivals have struggled to maintain their output, the Financial Times reported.

Definitely Maybe and (What’s the Story) Morning Glory, by Oasis. The 1990s Britpop titans — and obvious Beatles knockoffs — have reformed for a series of gigs, with the first this evening in Cardiff, Wales. They made seven studio albums before splitting up in acrimony, but their first two are the memorable ones, Britain’s poet laureate Simon Armitage wrote in The Guardian: “Two halves of the same whole, both full of pounding, adrenalised songs,” with lyrics that range from “the rousing, to the mysterious, to the trippy, to the witty, to the laughable, to the moronic.” Listen to Definitely Maybe and (What’s the Story) Morning Glory on Spotify, or you could try to get tickets for the tour, but let’s face it, that ship has sailed.

Meta’s new hires offer a glimpse into its nascent superintelligence unit, aimed at making the social media company’s AI capabilities more competitive with industry leaders, Semafor’s Rachyl Jones reported.

In a memo sent to OpenAI staffers, CEO Sam Altman hinted that the company is reevaluating compensation and criticized Mark Zuckerberg’s recruiting efforts, saying “Missionaries will beat mercenaries,” Wired reported.