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European Central Bank chief financial supervisor Claudia Buch has sent a letter to 110 lenders giving them until the end of October to come up with a “comprehensive action plan” on how they will tackle risks from cutting-edge artificial intelligence models. "Emerging AI models are capable of identifying software vulnerabilities and generating functioning exploits at unprecedented speed, compressing the timeline between vulnerability discovery and exploitation. These developments have potentially profound implications for the confidentiality, integrity and resilience of banks’ information and communication technology (ICT) systems," Buch wrote. In a separate warning, the European Systemic Risk Board, a European Union body that issues recommendations to other authorities, also said systemic cyber risks stemming from frontier AI models “should be treated as a source of systemic risk” by the finance industry.

 

Financial Times

Politico

Reuters

The Bank of England is planning to relax capital rules for major UK banks to encourage lending and support economic growth, but it has warned that weaker safeguards could increase financial stability risks. Proposed changes would remove a leverage ratio buffer introduced after the 2008 financial crisis, a move that would primarily benefit large lenders such as NatWest, Lloyds, Nationwide and Santander UK by reducing the capital they must hold. The move follows pressure from the government to cut regulatory burdens and boost investment. However, the Bank’s Financial Policy Committee warns that easier lending could fuel debt-driven investments, particularly in highly valued AI-related stocks, increasing risks to financial markets. It also highlighted growing concerns that rapid advances in AI could increase cybersecurity and operational threats to banks and the wider financial system.

 

City AM

The Guardian

A five-day power outage in Berlin in January was caused by a terrorist attack, a state-appointed commission has said in a report which makes recommendations to bolster security on critical infrastructure and urges more federal funding to better prepare for such crises. “The terrorist attack on the power grid in January 2026 was a wake-up call for Berlin and other cities,” the commission said. “The power outage was resolved in just a few days, yet it revealed how ill-prepared Berlin is for larger, longer-lasting, or hybrid situations.” The report calls for a new position of chief resilience officer for Berlin.

 

Bloomberg

A group of Democratic state attorneys general has said the Trump ​administration’s proposed tariffs of up to 12.5% on 59 countries and the European ‌Union, amid claims they failed to curb trade in goods made with forced labour, are unlawful. A letter signed by the AGs said the levies will make goods more expensive "and will continue the ​economic devastation that prior tariffs have caused." The U.S. Trade Representative's Office (USTR) is set for a three-day ​public hearing on the proposed tariffs of 10% on 16 economies, including the European Union, ​and 12.5% on 44 other countries. The USTR is abusing its authority under "Section 301" in a bid "to paper over ‌the ⁠administration’s predetermined sweeping tariffs on nearly all imports to the United States," said the AGs of states including Arizona, Michigan, Illinois, Virginia, Colorado, North Carolina, New York and New Jersey.

 

Reuters

The UK government now has more power to crack down on groups linked to hostile foreign states after Parliament passed the National Security (State Threats) Act. The law makes it illegal to support or receive payment from such a group and treats any organisation classed as state-linked under the legislation the same as if they were foreign intelligence services. Anyone convicted of doing the bidding of a hostile state-linked actor could be jailed for up to 14 years.

 

Bloomberg

Bloomberg reports on how Ireland is more exposed to AI-driven labour market disruption than other European countries. More than 6% of the country's workforce is employed in the tech sector, higher than the European Union average, and Ireland is heavily exposed to US multinationals including Google, Meta, Amazon, many of whom are cutting jobs as they invest in AI processes. There are also signs that AI is having an impact on early-stage hiring. Nevertheless, Colin Hunt, chief executive of financial services group AIB, says that Ireland’s longstanding reputation as a reliable location for multinational firms means it can withstand the pressure. “We are going through a period clearly of labour market loosening in the tech sector,” he said. “The impact is being felt. But will Ireland remain a key hub for tech in Europe? Yes.”

 

Bloomberg

Corporate attorneys say Argentine President Javier Milei's vision of “automated companies" run by AI - introduced as part of a comprehensive bill seeking to modernise and cut bureaucracy in corporate law - would be required to have a human ​administrator to oversee operations. It would be "too wild a first step to dispense with ​human agency entirely,” observed Lawrence Cunningham, director of the Weinberg Center for Corporate Governance at the University of Delaware, who nevertheless called Milei's proposal bold. “We’re not ⁠changing the world here so much as we’re recognising that you might run a business without any HR,” he said. “It’s the beginning of something."

 

Reuters

The Office for Budget Responsibility (OBR) has warned that rising pension costs will inflate UK public debt to 300% of GDP by 2075, up from 270%. Currently, public debt stands at nearly £3trn - around 95% of GDP - but the OBR has warned that it could move on to "an unsustainable and ever-rising path." Spending on state pensions is projected to increase from around 5% of GDP today to 9% within 50 years, with the triple lock accounting for a significant share of the increase. The OBR said that while tax revenues are expected to reach record levels by the end of the decade, this may not be enough to offset rising spending pressures. It also warned that future governments could face difficult choices over taxes and spending, with measures such as freezing tax thresholds helping raise revenue while receipts from energy-related taxes decline as the economy moves towards net zero.

 

Financial Times

City AM

European Central Bank Governing Council member Emmanuel Moulin has said the bank is in a “good position” following an interest rate increase last month and data showing inflation has eased amid an oil price slump. “We are not doing forward guidance so I won’t say what we will do in July,” Moulin said at the Rencontres Economiques conference in Aix-en-Provence. “But what is true is that the fall in oil price that was very rapid reassures us and puts us in a better position today on rates.”

 

Bloomberg

Swiss pharmaceutical giant Novartis has agreed to buy London-headquartered cancer treatment group Myricx Bio in a $1.5bn deal - the latest foreign takeover of a UK biotechnology company.

 

Financial Times

The European Commission has adopted finalised revisions to the European Sustainability Reporting Standards (ESRS) and a voluntary reporting standard for smaller companies, marking a key step in simplifying sustainability reporting under the EU's Corporate Sustainability Reporting Directive (CSRD). The revised standards significantly reduce mandatory disclosure requirements, clarify that asset managers do not have to report sustainability information for client-managed investments, and align more closely with international reporting standards, following reforms that cut the number of companies subject to mandatory reporting by about 90%.

 

ESG Today

Carlsberg has reportedly confidentially filed draft papers for an initial public offering of its Indian business that could raise up to $700m, as the Danish brewer looks to capitalise on strong investor demand in India's equity market. The proposed listing is expected to comprise a secondary share sale by Carlsberg and could take place later this year, although the size, timing and structure of the transaction remain subject to change. The brewer is said to be working with Kotak Mahindra Capital, JPMorgan and Citigroup on the offering. If completed, the flotation would add to a record pipeline of Indian IPOs, following a surge in companies filing draft prospectuses during June. Carlsberg India is the country's second-largest brewer, with around 22% market share and 14 breweries, including eight company-owned facilities.

 

Economic Times

Apple is reportedly in talks to source memory chips from Chinese semiconductor manufacturers ChangXin Memory Technologies and Yangtze Memory Technologies for devices sold in China, as it seeks to ease the impact of a global memory shortage that has driven up component costs and forced price increases across its product range. The discussions are said to be ongoing and no agreement has been reached. Both companies are on a Pentagon blacklist of entities alleged to support China's military, raising the prospect of political opposition in Washington despite there being no formal requirement for Apple to obtain approval. According to the report, chief executive Tim Cook has appealed to Trump administration officials in an effort to mitigate any political fallout. Apple currently sources memory chips from Samsung Electronics, SK Hynix, and Micron Technology, all of which are struggling to meet surging demand

 

The Japan Times