Investors will bet on Russia to prevent sanctions as Trump seeks a settlement

Today’s Agenda: Netanyahu is planning to loot Chief Sinbet. Tariffs complicate the Fed’s work. The European “peace dividend” is over. Alibaba’s AI Pivot. And young people lose faith in the state

Good morning, I’m back to Firstft. As investors seek profits from Donald Trump’s settlement with Vladimir Putin, we start our week of work, looking at the sanctions bets that investors are using.

What’s going on: hedge funds and brokers have taken the West out of a way to exchange Russian assets, but they believe they can rally sharply if the US president eases sanctions as part of a deal to mediate a ceasefire in Russia’s war against Ukraine. Some are hunting the bonds of Russian companies that were considered little worth following the 2022 Ukrainian invasion, but are now marked by internal ratings from several investors. Others use Kazakhstan’s tenge as a proxy for the ruble due to their economic ties with Russia, but such transactions are difficult to scale.

Why it matters: Following the Ukrainian invasion, the international market for Russian assets has evaporated. Because sanctions cut banks from global financial plumbing, and the country suffered from enormous capital. Russia’s central bank raised interest rates, particularly as the Kremlin launched a war production clash programme. The ruble trade is bet on this dynamic being reversed. Especially when Russians who fled the country for fear of being mobilized return with savings hidden in Georgia, Armenia and other nearby countries.

We will explain in detail the significant risks facing these transactions. The following information on war and local security is increasing.

Peace negotiations: Trump said he will speak with Putin tomorrow as the US tries to mediate a ceasefire deal.

Defense of Europe: Trump’s threat has led neutral Switzerland to seek close ties between NATO and the EU, its new defense minister said.

Here is the other thing we keep tabs today:

Economic Data: The OECD will publish a preliminary economic outlook, with the right publishing the UK home index.

NVIDIA: Chip Giant’s 5-Day Artificial Intelligence Conference begins in San Jose, California.

UK Regulations: Prime Minister Rachel Reeves discusses plans to limit competitive Watchdog merger investigations when he meets regulators on Downing Street today.

St. Patrick’s Day: East Feast Day of the Irish Patron Saints is celebrated all over the world. Joseph Kennedy III is a former envoy of Northern Ireland, reflecting the lessons of the bonds between the region and the transatlantic.

Join the FT Expert subscriber-only webinar next Thursday. They discuss the future of Ukraine and a full-scale invasion that will enter Russia’s fourth year. Please sign up for free.

Five more top stories

1. Benjamin Netanyahu said he would plunder one of the domestic spy chiefs, one of the last security guards still at the post office since Hamas’ October 7 attack. The Israeli Prime Minister said that Loneen Barr, head of the Sin Bet Intelligence Agency “growed over time,” had a “continuous lack of confidence.” Here’s why this move causes more political turmoil:

2. Trump’s uncertainty about tariffs complicates the work of the Federal Reserve. The US Central Bank fears it could stimulate inflation and cause a slowdown in the economy. Economists warn that if rate setters need to rely on “prediction frameworks,” there is a risk that they will be too dependent on backward-looking data.

3. Exclusive: European companies that added the US list often do not see a rise in their valuation, and the Times of Finance discovered challenging claims made by some executives. However, two-thirds of the 12 companies surveyed increased stock liquidity after the move. Learn more about FT analysis.

4. GE Aerospace Chief Larry Culp received a $89 million salary last year, becoming one of the highest-paid executives of any US company that has reported compensation so far this year. GE Aerospace stock price rose 45% following the GE company split, which was completed in April last year. Please read the entire story.

5. The US should invest in its own shipbuilders using fees charged on Chinese-made vessels, US maritime regulators said. Louis Sora, who was appointed chairman of the Federal Maritime Commission in January, told FT that the US needs to offset China’s subsidies for its own shipbuilding industry and “fight against fire.”

Detailed news

European countries collectively save hundreds of millions of euros per year (postwar “peace dividends”) in recent decades, freeing up resources for other priorities, including welfare states. But after Trump’s threat to reduce US support for Europe, the continent is now facing brutal calculations as it is embarking on a dash to re-arm.

We’re reading too. . .

Alibaba’s AI Pivot: The Chinese Tech Giant has established a lead in a fiercely competitive sector, with billionaire founder Jack Ma in favor.

Priority and Reeves: The Prime Minister and his Prime Minister need to see the difficult times coming to Britain as well as opportunities, as crisis, writes Martin Wolf.

Democrats’ Choice: Party needs to come up with a consistent policy stance if they want to fight Trump, writes Lana Forhaal.

UK Welfare Issues: Approximately 3.5 million working-age adults are trapped in health-related benefits, both incentives and support needed to enter employment.

The chart of the day

According to FT analysis of Gallup Data, youth in Greece and Italy are most unhappy with their trust in public services and institutions. Experts have locked in growing misfortunes around factors such as political polarization, stagnant quality of life, and difficulties in riding real estate ladders.

Take a break from the news. . .

Enjoy a honey bun latte or a cold brew with spices along with cinnamon and chili? Place your Americano with these weird caffeine hits and spice up your coffee orders.