REUTERS WORLD NEWS: Russia Finalizes Annexation, Ukraine Marches On, Korean Tension, More

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Reuters
The Reuters Daily Briefing

Wednesday, October 5, 2022

by Linda Noakes

Hello

Here’s what you need to know.

OPEC+ heads for a clash with the U.S., banks financing Musk’s Twitter deal face hefty losses, and why residents of a South Korean seaside town got a big surprise

Today’s biggest stories

A Ukrainian service member holds captured Russian weapons near the town of Bakhmut, Donetsk region, October 4, 2022. REUTERS/Anna Kudriavtseva

RUSSIA-UKRAINE WAR

A South Korean Air Force F-15K fighter jet takes part in a joint bombing drill with the U.S. in this handout picture provided by the Defense Ministry, South Korea, October 4, 2022

WORLD

  • South Korea and the U.S. military conducted rare missile drills and an American supercarrier repositioned east of North Korea after Pyongyang flew a missile over Japan, one of the allies’ sharpest responses since 2017 to a North Korean weapon test. But the South Korean display of military force went wrong in a blaze of burning rocket fuel, alarming residents of a seaside town.
  • British Prime Minister Liz Truss urged her fractious party to stick together and help transform the economy and the country, fighting to restore her dwindling authority after a chaotic first month in office. As she started to speak at her party’s annual conference two protesters held up a sign asking ‘Who voted for this?’ before they were escorted away by security personnel as the crowd chanted ‘out, out, out’.
  • Iran summoned Britain’s ambassador for the second time since nationwide protests erupted last month, Iranian media reported, stepping up accusations of Western meddling in ongoing unrest sparked by a woman’s death in police custody. Here’s a timeline of events in Iran since Mahsa Amini’s arrest and death.
  • Brazilian President Jair Bolsonaro and his leftist challenger were hunting endorsements as they fine-tuned their campaigns for a runoff in an election that has proven more competitive than expected. The highly polarized race, marked by threats from Bolsonaro that he might contest the results, will be decided on October 30.

Ethiopia’s government has accepted an invitation by the African Union to participate in peace talks aimed at ending a two-year conflict with rival Tigray forces. The conflict has killed thousands of civilians and uprooted millions.


U.S.

An OPEC sign is seen as OPEC+ meets in Vienna, October 5, 2022. REUTERS/Lisa Leutner

BUSINESS & MARKETS

OPEC+ looks set for deep cuts to its oil output targets when it meets today, curbing supply in an already tight market despite pressure from the United States and others to pump more. The potential cut could spur a recovery in oil prices that have dropped to about $90 from $120 three months ago.

Elon Musk is proposing to proceed with his original $44 billion bid to take Twitter private, calling for an end to a lawsuit by the social media company that could have forced him to pay up, whether he wanted to or not. Musk’s U-turn could not have come at a worse time for the banks funding a large portion of the $44 billion deal and they could be facing significant losses.

A steepening drop in euro zone business activity last month will likely put paid to any hopes the currency union avoids recession, just as elevated inflation puts pressure on the European Central Bank to act, a survey showed. British businesses last month suffered the sharpest contraction in activity since early last year, although the downturn was a little less severe than first estimated.

Faced with mounting evidence that loose U.S. monetary policy contributed to the breakout of inflation last year, the Federal Reserve now faces the risk it jumped too far the other way with its plans to fight price pressures through continued aggressive interest rate hikes even as the world economy wobbles.

Financial messaging system SWIFT has laid out its blueprint for a global central bank digital currency network following an eight-month experiment on different technologies and currencies. SWIFT said its trial resembled a bicycle wheel where 14 central and commercial banks in total connected spoke-like into its main hub.

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