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British pound coins are seen in front of displayed stock graph.

Reuters

What We’re Watching: Bank of England intervenes, Pyongyang provocations, Israel-Lebanon gas deal

Bank of England to the rescue?

The Bank of England stepped in Wednesday to try and calm markets that had gone haywire after the Conservative British government, led by new PM Liz Truss, introduced £45 billion ($49 billion) worth of tax cuts despite sky-high inflation. The bank will fork out £65 billion ($70 billion) to buy government bonds “at an urgent pace” to try to revive investor confidence and boost the pound, which recently fell to a record low against the US dollar. This development comes after the International Monetary Fund issued an unusual rebuke this week of British fiscal policy, warning that the tax cuts would exacerbate inequality. There are also concerns that some pension funds, which invest in government bonds, could be made insolvent following the collapse of UK government bond prices in recent weeks. Though the bank’s intervention is significant, there’s no indication that the Truss government is willing to reverse course (i.e. limit borrowing) to regain market trust. Meanwhile, in a keynote speech Wednesday, Labour leader Keir Starmer said Tories had “crashed the pound,” noting that “this is a Labour moment.” Indeed, Labour is currently trouncing the Conservatives in the polls, but Starmer would need to maintain this momentum until the next general election, which must be held by January 2025.

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Paige Fusco

The Pacific rebellion scaring Washington

The US is scrambling to step up its diplomatic game with Pacific Island leaders following a breakdown of unity at a regional summit this week that analysts warn could weaken resistance to China’s plans for controversial security alliances.

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Ukraine's grain exports are being held hostage.
REUTERS/Dado Ruvic

What We’re Watching: Russia & Ukraine talk grain, US talks fish

Russia and Ukraine get granular, finally

The two countries at war on Wednesday agreed in principle to a UN-backed plan to resume exports of grain from Ukraine’s Black Sea ports. Before Russia’s invasion, Ukraine was one of the world’s largest exporters of wheat and cooking oils, but the war has crippled those shipments, inflaming food prices globally and undercutting food security in dozens of emerging market countries. Under the UN plan, Ukraine would clear mines from its ports, Russia would allow safe passage for grain boats, and Turkey would provide safe shipping corridors. But Kyiv is wary about Moscow using the de-mined sea lanes to launch a fresh naval offensive, and Moscow insists on the right to inspect any boats for weapons. The two sides and Turkey are set to ink an official deal next week. For complete coverage of the growing global food crisis, be sure to see our Hunger Pains project.

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Ukraine War Threat Looms As European & US Leaders Show Unity In Munich | Europe In :60 | GZERO Media

European & US leaders resolute as threat of Ukraine war grows

Carl Bildt, former Prime Minister and Foreign Minister of Sweden, is joined by Ian Bremmer, president of Eurasia Group and GZERO Media, to provide perspective on the Ukraine crisis at the Munich Security Conference.

Carl Bildt: This is the most dramatic conference that I think every one of us has experienced. I mean, there seems to be significant probability of war breaking out in Europe within days. We have the Ukraine president, we'll see if he will come during the day, but we have an assortment of European leaders and vice president of the United States. And everyone is discussing, can anything more be done to prevent war? And what really do we do if it breaks out?

Ian Bremmer: And it's kind of funny. The theme of the conference this year is helplessness. And when I flew in, I'm like, "That's a horrible theme for the conference." But actually, as it plays out, it's starting to feel a little bit more on target.

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US Vice President Kamala Harris

Michael Brochstein/Sipa USA

What We're Watching: Harris goes to Munich, French troops quit Mali, Japan's soft opening, Africa's mRNA mission

Harris goes back to the future in Bavaria. In recent years, the Munich Security Conference (MSC) – to say nothing of the broader transatlantic alliance – have suffered from a sense of unclear purpose. US President Donald Trump questioned NATO’s value, and French President Emmanuel Macron has called it “brain-dead.” Without the Cold War framework, many have asked whether NATO even has a purpose? But things couldn’t feel more different today, according to Eurasia Group President Ian Bremmer. “You’re talking about US leadership and an alliance that feels unprecedentedly threatened by the recent escalation in Ukraine from Russia,” said Bremmer from Munich on Thursday. And the face of that US leadership at Munich this year is US Vice President Kamala Harris, who will deliver an important address on Saturday. Harris, who was also tasked with handling the challenge of migration at the US-Mexico border last year, has struggled to shine in her historic role as the first female Veep. A powerful address at Munich, delivered in the thick of a major transatlantic security crisis, could be her moment in the sun.

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Lukashenko’s Exploiting Migrants To Pressure EU Over Sanctions | Europe In :60 | GZERO Media

Belarus president exploiting migrants to pressure EU on sanctions

Carl Bildt, former Prime Minister and Foreign Minister of Sweden, shares his perspective from Europe:

What's the nature of the migration crisis between Belarus and Poland?

Well, it's not a migration crisis, really. It's a question of the weaponization of the misery of people. Lukashenko wants to, sort of, exert pressure on Poland and on the European Union because of the sanctions that are imposed upon him for his undemocratic behavior. And that is importing miserable people from the Middle East, flying them into Minsk, probably at great expense to them, and then effectively forcing them over the border to Poland. That has to be stopped, and a number of measures are underway to do that. It's really an unacceptable way of exploiting people.

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What We're Watching: VP Harris in Southeast Asia, FDA approves Pfizer jab, Qatar's first legislative election

Harris' Southeast Asia tour overshadowed by... Afghanistan: It's been a bad week and a half for the Biden administration, which has gotten terrible PR over its disastrous withdrawal from Afghanistan. But Vice President Kamala Harris is trying to flip the script a bit on a current, week-long tour of Southeast Asia. The main aim of the Veep's visit to Singapore and Vietnam is to shore up relations with Asian partners as a bulwark against an increasingly aggressive China, and to emphasize the Biden administration's "pivot" to the Indo-Pacific region more broadly. That's particularly true in Vietnam, which is extremely concerned about China's behavior in the disputed South China Sea. But when Harris held a press conference with Singapore's PM Lee Hsien Loong Monday, hoping to highlight new cooperation on climate change, cyber security, and COVID tracking, she was instead peppered with questions about violence at Kabul's airport and the administration's so-far botched evacuation plans for Americans there.

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