The European Commission has approved an exemption allowing Ukraine to use part of the initial ~€5.9bn tranche for drone procurement — from a €90bn support-loan package — to purchase drone components from suppliers outside the EU/approved partner list. EU funding rules normally prioritize purchases from EU, Ukrainian and authorized partners, but officials granted the exception after Ukraine’s rapid drone consumption outpaced European and allied ability to supply certain critical components. The d

Andy Burnham, set to replace Starmer next Monday, will receive a Treasury economic assessment on his first day. The report projects Q4 inflation revised up to 3.2%, says gilt yields and financing costs will continue rising, and anticipates the Bank of England will raise rates at least once more before year-end. It warns that if a US–Iran ceasefire is not quickly restored, international oil could reach $150/bbl, lifting energy, food and jet-fuel prices, pushing up living costs and increasing downside pressure on the UK economy. Officials also cite elevated cyberattack risk from Iran and Russia and imminent policy decisions on Ukraine, Russia sanctions and Strait of Hormuz security as early challenges for the new administration.

Germany will cut over €30 bln from its Climate and Transformation Fund by 2030 and shift part of the money into the federal budget, the cabinet approved. The plan reduces fund spending by €19.7 bln over the next four years and transfers a further €13.2 bln to the federal budget. The coalition led by Chancellor Merz and Finance Minister Klingbeil had previously allocated €10 bln to the fund; some projects backed by the fund will face funding cuts as part of public spending consolidation. The government said the reductions are partly justified by a separate multibillion-euro subsidy scheme to lower electricity costs for energy‑intensive firms, which requires participating companies to invest in reducing production-related emissions.