Signal

Luisa Vieira

Vladimir Putin isn't exactly losing the war in Ukraine, but he's definitely not winning it either.

Although Russia has more territory now than before the invasion, things aren't going well. Putin has had to call up reservists, his annexation of four Ukrainian regions was immediately challenged, and he's on the hook now for selling to the Russian people the idea that they are at war with NATO and the West.

Putin's push to win at all costs might soon force him to make one very serious and potentially scary choice. He needs to land a big blow, so what bigger blow than the biggest of them all: nuclear weapons. He's already hinted at the possibility, while Washington and NATO are sorting through what they might do in response.

Let's look at why he might, or might not, pull the trigger to launch what is known as a tactical nuke, a low-yield atomic warhead designed to take out military targets, not entire cities.

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GZERO Media

Developed and emerging economies alike have seen the value of their currencies plummet in recent months due to the economic reverberations of the ongoing war in Ukraine. Food and fuel shortages have put upward pressure on prices, and inflation has soared to record highs in some places. While inflationary pressures are surely being felt in the US, the greenback has reached a two-decade high compared to other major currencies. This is in part because the US Federal Reserve’s measures to curb inflation have boosted investor confidence. However, a strong US dollar can have painful consequences for other states, particularly import-reliant ones, because most global commodities are priced in US dollars. We take a look at the value of currencies used in the world’s largest economies compared to the US dollar before and after Russia invaded Ukraine.

A man walks pass by a Puerto Rican flag painted on a door in the aftermath of Hurricane Fiona in Puerto Rico

Reuters

60 million: US President Joe Biden pledged $60 million in aid for Puerto Rico on Monday during his visit to the US island territory to survey recent hurricane damage. Large parts of the island remain without power two weeks after Hurricane Fiona made landfall.

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UK Prime Minister Liz Truss and Chancellor of the Exchequer Kwasi Kwarteng attend the annual Conservative Party conference in Birmingham, Britain

Hannah McKay via Reuters

Truss’s tax U-turn

Will it be enough? New British PM Liz Truss’s government has reversed course on its economic agenda. Chancellor Kwasi Kwarteng told the Conservative Party conference on Monday that a proposal to scrap the UK’s 45% tax rate for high-income earners would be axed. He cited the recent market chaos and vowed that there would be “no more distractions” in pursuing the rest of the government’s proposed tax policies. This caps a dismal couple of weeks for the new Tory leadership during which the Bank of England tried to calm markets after Kwarteng introduced £45 billion ($49 billion) worth of tax cuts despite sky-high inflation. The upheaval also caused the pound to plummet against the greenback (it regained some value on Monday). Truss and Kwarteng said they changed tack after listening to voters struggling amid the cost-of-living crisis. But it had become clear that the plan would have struggled to pass the House of Commons. The top tax rate accounted for just £2 billion of the proposed tax cuts, so this reversal will only go so far in placating opponents and markets. Truss addresses the party conference on Wednesday, and after her rocky start, we’ll be watching to see whether she can win support for her economic plan – and revive her party’s dismal approval rating enough to stay in the top job.

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A supporter of former President Luiz Inacio Lula da Silva reacts as people gather after polling stations were closed in the presidential election in Sao Paulo, Brazil.

REUTERS/Amanda Perobelli

Lula’s bittersweet first-round win

Left-wing former President Luiz Inácio "Lula" da Silva won the first round of Brazil's presidential election on Sunday but fell short of the outright majority needed to avoid an Oct. 30 runoff that might now be tighter than expected. With almost 97% of the ballots counted, Lula got 47.9% of the vote, 4.2 percentage points more than his nemesis: the far-right incumbent President Jair Bolsonaro. Although Lula is still favored to also win in the second round, the result is good news for Bolsonaro because he outperformed the polls, which had him trailing Lula by a wide margin and led many to believe his rival could win it all in the first round. Some experts think that Bolsonaro is consistently underestimated because many Brazilians are hesitant to admit they vote for him — a theory pollsters deny. Lula's narrower-than-expected victory might give Bolsonaro even more fodder to claim that the surveys are rigged against him. Brazil's president has spent months firing up his base with baseless doubts about the integrity of the election process, and no one would be surprised if he tries to pull a 6 de Janeiro if he loses the runoff.

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US Secretary of State Antony Blinken and India's Foreign Minister Subrahmanyam Jaishankar hold a news conference in Washington, DC.

Saul Loeb/Pool via REUTERS

After years of favoring New Delhi, the US is now back to balancing between India and Pakistan.

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General view of a Baltic Pipe compressor station in Budno, Poland.

Agencja Wyborcza.pl via REUTERS

10 billion: On Saturday, natural gas from Norway began flowing to Poland through a pipeline that can pump 10 billion cubic meters per year through a new Baltic Sea route via Denmark. The new gas link, the first in decades, is a major milestone in Europe's efforts to diversify away from Russian gas.

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