Biden authorises Ukraine to strike Russia with long-range US missiles

In today’s newsletter:

• Biden’s big policy shift on Ukraine

• A deadly stabbing attack in China

• Chinese investment boosts Hungary’s recession-hit economy

Good morning. US President Joe Biden has authorised Ukraine to launch limited strikes into Russia using US-made long-range missiles, in a big policy shift before the end of his White House term in January, two people familiar with the decision said.

Biden’s move comes in response to the deployment of thousands of North Korean troops to support Russia in its war against Ukraine, and after a barrage of new strikes on Ukrainian cities from Russia at the weekend.

The US-made long-range missiles are likely to be first used by Ukraine to target Russian and North Korean forces in Russia’s Kursk region, where Ukrainian troops seized territory during the summer, according to people familiar with the matter.

Biden has long resisted allowing Kyiv to launch strikes within Russia using the missiles, known as the Army Tactical Missile System, on the grounds that it could escalate tensions with Moscow.

But he is now dropping those objections with more than two months before he leaves office to make way for Donald Trump. Read more about Biden’s decision.

• More on North Korea: Pyongyang has supplied Moscow’s army with long-range rocket and artillery systems, a Ukrainian intelligence assessment has found.

And here’s what else I’m keeping tabs on today:

• Economic data: Hong Kong reports October employment data and Thailand releases third-quarter GDP.

• UK-China ties: Keir Starmer will hold the first face-to-face talks by a British prime minister with Chinese President Xi Jinping since 2018, as he seeks “sensible and pragmatic engagement” with Beijing.

• G20 summit: The gathering of the world’s richest nations begins today in Rio de Janeiro, with Donald Trump’s election as US president threatening to throw international initiatives on climate change and taxation into disarray.

Five more top stories

1. Eight people were killed and 17 injured in a stabbing attack at a vocational college in the eastern Chinese city of Wuxi late on Saturday, the country’s second mass-casualty event in a week. Police said a 21-year-old suspect was detained and confessed to carrying out the attack.

2. Albemarle, the world’s largest lithium producer, says it is not economically viable to build a supply chain in North America and Europe that could wrest control of critical minerals from China. The chief executive of the company, Kent Masters, told the FT that the US was “absolutely” at risk of losing the race to compete with China on the commodity, which is crucial for electric vehicle industry.

3. Donald Trump’s advisers have sought assurances from the top candidates to be Treasury secretary that they are committed to his sweeping tariffs plans, people familiar with the discussions said. Scott Bessent, a hedge fund manager, and Howard Lutnick, the chief executive of financial firm Cantor Fitzgerald, are locked in a tight battle for the top economic cabinet post in the next administration.

4. A Social Democrat politician has joined the calls for the popular defence minister Boris Pistorius to run as the party’s candidate for chancellor in February’s snap elections instead of Olaf Scholz. Joe Weingarten became the first sitting SPD MP to call for Pistorius to enter the race, in a sign of growing concern in the party over Scholz’s low approval ratings.

5. Northvolt’s fate is hanging in the balance as the troubled Swedish battery maker considers filing for Chapter 11 protection from creditors or even bankruptcy. People involved in the negotiations about the future of the one-time big hope for Europe’s automotive industry said that its future was likely to be decided in the coming days after talks about a rescue package recently collapsed.

News in-depth

Hungary has captured more than a quarter of all Chinese investment coming into Europe over the past two years. The outsized share has boosted an otherwise struggling Hungarian economy hit by the EU withholding about €20bn of funding over rule of law concerns. President Viktor Orbán’s challenge now is pulling off the diplomatic gymnastics required to simultaneously remain an ally to Xi Jinping and Donald Trump’s incoming administration of China hawks, while managing the threat of a chronic decline in EU funds.

We’re also reading . . . 

• The markets under Trump: Expect a short-term high — but many investors are worrying about what comes next, writes Rana Foroohar.

• Russian business: Michael Calvey, the founder of private equity firm Baring Vostok, recounts his surreal descent from championing investing in Russia to being arrested in the country.

• Rudeness in the workplace: Straight talkers take pride in honesty but can demotivate colleagues, writes Emma Jacobs.

Chart of the day

Chinese smartphone manufacturers including Realme and Honor are intensifying efforts to gain a stronger foothold in Europe, hoping to challenge Samsung and Apple on the continent with fancier handsets.

Take a break from the news

Squid Game, the most-watched show in Netflix history, returns for a second season next month. Its creator Hwang Dong-hyuk told the FT what inspired the show’s ultra-violent critique of capitalism — and why he lost nine of his teeth during the making of season one.