U.S. regulators this week proposed easing capital rules on big U.S. banks in a package of proposals that departs from globally agreed-upon standards. Now, it’s sparking calls from European trade groups to loosen the EU’s own version of the rules. On Thursday, U.S. bank regulators released a number of potential rule changes intended to align U.S. policy with a 2017 global agreement known as Basel III. Its provisions imply a 2.4 percent decrease in capital held by the largest U.S. banks and bigger cuts for smaller banks. European regulators, anticipating the U.S. move, had already been discussing loosening their own requirements, which currently call for raising the capital that banks must have on hand by around 8 percent by 2033. But the breadth of the U.S. proposal has prompted trade groups in Europe to push officials to move faster. Taken together, the moves could weaken the global regulatory framework instituted on both sides of the Atlantic after the 2008 financial crisis. “The U.S. proposal appears to mark a clear shift toward easing capital constraints to support lending and growth, while Europe seems to continue moving in a different direction,” said Sébastien de Brouwer, deputy CEO of the European Banking Federation, a trade group. The United States’ pullback is “making it more urgent than ever to review the EU framework to preserve competitiveness and financing capacity of European banks,” he said. Over the past few months, European regulators had started to reevaluate the competitiveness of the bloc’s banking sector, especially as major European economies have struggled to keep pace with U.S. growth. EU heads of government called Thursday night, in a statement agreed upon before the release of the U.S. proposal, for the European Commission “to propose targeted amendments to the prudential framework in order to enhance the capacity of the banking sector to finance the European economy.” The Commission is also authoring a report on the competitiveness of its banking sector, due after the summer, which will pave the way for legislative proposals. This is set to be a wide-ranging report that could relate to bank capital requirements or other policies. The European Central Bank has already made recommendations for simplifying the bloc’s banking rules ahead of the report, including calling for lighter Basel rules for small banks and for capital buffers to be merged. None of its recommendations were as sweeping as what the U.S. has proposed, however. The U.S. proposal departs from the intent of the original Basel accords, a long process in which global regulators worked to address the root causes of the global financial crisis, critics say. Regulators in 2017 reached an agreement around the framework for jurisdictions to mitigate risks. “This definitely goes against not just the ethos but the intent, spirit and goal of Basel III,” said Dennis Kelleher, CEO of Better Markets, an advocacy group that supports stronger financial regulation. “This proposal when finalized will inevitably ignite another global race to the regulatory bottom” One of the biggest departures relates to the unwinding of the “output floor,” which sets a minimum capital threshold for banks’ trading activities. The new proposal uses a new risk-weighting approach that would do away with the threshold. “This will encourage other jurisdictions to do the same, undermining a key reform and cornerstone of the Basel III agreement,” Federal Reserve board member Michael Barr said Thursday. In the 2017 international talks, the U.S. had argued in favor of a restrictive output floor. Major European banks argued that would hike their capital requirements above and beyond those of the U.S., given the makeup of European banks’ trading books, stymieing lending to the real economy. The threshold was ultimately set at a lower rate than what American negotiators wanted. European regulators had recently moved to delay implementation of the Fundamental Review of the Trading Book, the portion of Basel focused specifically on so-called market risk, or rules governing how to capitalize banks’ trading activities. “Removing the output floor for market risk is a divergence from international standards, and we will carefully assess the impact on internationally active banks, in particular, with respect to the ongoing discussions on EU FRTB implementation and banking competitiveness in Europe,” said Caroline Liesegang, head of prudential regulation and research at the Association for Financial Markets in Europe, which represents large banks. In the past, U.S. regulators had tended to “gold plate” the country’s rules for big banks, meaning they put in provisions above and beyond what Basel requires in order to acknowledge the United State’s central role in the global financial system and push for stricter global standards. In 2023, U.S. regulators failed to pass a capital proposal that would have raised aggregate capital by 16 percent and would have adhered more strictly to the international framework. On Thursday, U.S. regulators said the international standards should not be an unnecessary barrier to the needs of the U.S. financial system. “We should not seek to punish U.S. consumers and businesses by imposing higher costs of credit, or forcing credit availability outside of the banking system, particularly if this is done only to show greater alignment with Basel or any other international standard,” said Federal Reserve Vice Chair for Supervision Michelle Bowman, who led the U.S. central bank’s crafting of the proposal. The dilution of the agreement and its pullback on capital “will make it more challenging for the U.S. to use Basel, as it so often has, to further its own agenda,” said Kathryn Judge, professor at Columbia Law School. In the U.K., which has since left the bloc, the capital rules are expected to have less of an impact on banks than EU peers. A spokesperson for the Prudential Regulation Authority, the U.K.’s main banking regulator, said that the thinking remains the same as in its final rules, which will see the market risk rules apply from 2028. The European Commission declined to comment. The Basel Committee said it doesn’t comment on individual jurisdictions. The Federal Reserve declined to comment. Bjarke Smith-Meyer and Elliot Gulliver-Needham contributed to this report.

President Donald Trump has often frustrated European allies with his overt entreaties to Russian President Vladimir Putin and harsh words for Ukrainian President Volodymyr Zelenskyy. But behind the seeming imbalance is a longer-term strategic goal – countering China. The Trump administration believes that incentivizing Russia to end the war in Ukraine, welcoming it back economically and showering it with U.S. investments, could eventually shift the global order away from China. It’s a gamble – and one Ukrainians are concerned with – but it underscores the administration’s belief that the biggest geopolitical threat facing the United States and the West is China, not Putin’s Russia. While countering China isn’t the only reason the administration wants a truce, it does help explain why after more than 15 months of fruitless talks and multiple threats to walk away, the president’s team – special envoy Steve Witkoff and son-in-law Jared Kushner – keep looking for a breakthrough. A Trump administration official, granted anonymity to discuss ongoing negotiations, said finding a “way to align closer with Russia” could create “a different power balance with China that could be very, very beneficial.” The administration’s desire to use Ukraine peace negotiations to counter China has not been previously reported. But many observers believe this plan has little hope of succeeding – at least while Putin and Chinese leader Xi Jinping remain in charge. And the idea of giving Russia economic incentives to grow closer to the U.S. is concerning for Ukraine, said a Ukrainian official, granted anonymity to discuss diplomatic matters. “We had such attempts in the past already and it led to nothing,” they said. “Germany had [Ostpolitik, Germany’s policy toward the East], for that and now Russia is fighting the deadliest war in Europe.” And when it comes to banking on breaking apart China and Russia, the Ukrainian official noted that both countries “have one [thing] in common which you can not beat – they hate the U.S. as a symbol of democracy.” Still, the strategy is in keeping with the administration’s broader foreign policy initiatives aimed at least in part in countering Chinese influence. Taking out Venezuelan leader Nicolás Maduro and pressuring Cuba’s government to the brink of collapse all diminishes China’s influence in the Western Hemisphere. The administration threatened Panama, which withdrew from Chinese leader Xi’s Belt and Road Initiative a month after Trump took office and called Peru’s deal with China surrounding its deepwater port in Chancay a “cautionary tale.” And striking Iran shifted China’s oil import potential, as Tehran supplied Beijing with more than 13 percent of its oil in 2025, according to Reuters. Indeed, the Trump administration official noted that between Venezuela, Iran and Russia, China was buying oil at below-market rates, subsidizing its consumption “to the tune of over $100 billion a year for the last several years.” “So that’s been a massive subsidy for China by being able to buy oil from these places on the black market, sometimes $30 a barrel lower than what the spot market is,” the person said. Even as there are reports that Russia is sharing intelligence with Iran, the U.S. and Russia keep talking. Witkoff and Kushner met with Kirill Dmitriev, a top adviser to Putin, last week. The Russians called the meeting “productive.” Witkoff said they’d keep talking. These negotiations and the broader efforts to counter China now take place under the spectre of Trump asking several countries, including China, for help securing the Strait of Hormuz. The National Security Strategy, released in November, spilled a fair amount of ink on China, though it often doesn’t mention Beijing directly. Many U.S. lawmakers — from both parties — consider China the gravest long-term threat to America’s global power. “There is a longstanding kind of U.S. strategic train of thought that says that having Russia and China working together is very much not in our interests, and finding ways to divide them, or at least tactically collaborate with the partner who’s less of a long term strategic threat to us,” said said Alexander Gray, Trump’s National Security Council chief of staff in his first term. Gray, who is currently the CEO of American Global Strategies, a consulting firm, compared the effort to former Secretary of State and national security adviser Henry Kissinger, who spearheaded President Richard Nixon’s trip to China during the Cold War in an effort to pull that country away from the Soviet Union. The State Department declined to comment for this report. However, a State Department spokesperson previously told POLITICO that China’s economic ties with Latin American countries present a “national security threat” for the U.S. that the administration is actively trying to mitigate. The White House declined to comment. Fred Fleitz, another Trump NSC chief of staff in his first term, noted that the president has “pressed Putin to end the war to normalize Russia’s relationship with the U.S. and Europe,” and wants Russia to rejoin the G8. “It is clear that Trump wants to find a way to end the war in Ukraine and to coexist peacefully with Russia,” said Fleitz, who now serves as the vice chair for American Security at the America First Policy Institute. “But I also believe he correctly sees the growing Russia-China alliance as a far greater threat to U.S. and global security than the Ukraine War and therefore wants to find ways to improve U.S.-Russia relations to weaken or break that alliance.” Others, however, remain skeptical. Craig Singleton, senior director of the China program at Foundation for Defense of Democracies, said the goal to break Russia and China is “appealing in theory, but in practice the partnership between Moscow and Beijing is iron-clad.” “Obviously there is nothing wrong with testing diplomacy and President Trump is a dealmaker. But history probably suggests that this won’t really result in much,” Singleton added. “The likely outcome [with Russia] is limited tactical cooperation with the U.S., not some sort of durable break with Beijing.” And China seeks to keep Russia as an ally and junior partner in its relationship as a counter to Western powers. Chinese Foreign Minister Wang Yi reaffirmed the relationship in a press conference this month, saying, “in a fluid and turbulent world, China-Russia relationship has stood rock-solid against all odds.” Secretary of State Marco Rubio, shortly after his confirmation, hinted at the broader strategy, saying in an interview, that “a situation where the Russians are permanently a junior partner to China, having to do whatever China says they need to do because of their dependence on them” is not a “good outcome” for Russia, the U.S. or Europe. But Rubio, like the Trump administration official given anonymity to discuss ongoing negotiations, both acknowledged that fully severing those ties would be a tough lift. “I don’t know if we’ll ever be successful at peeling them completely off a relationship with the Chinese,” Rubio said in February of last year. Adam Savit, director for China policy at the America First Policy Institute, argued that “Russia matters at the margins, but it won’t be a decisive variable in the U.S.-China competition,” and that the “center of gravity is East Asia.” “Russia gives China strategic depth, a friendly border, energy supply, and a second front in Ukraine to sap Western attention,” he said. “Getting closer to Russia could complicate China’s strategic position, but Moscow is a declining power and solidly the junior partner in that relationship.”

Anton, a 44-year-old Russian soldier who heads a workshop responsible for repairing and supplying drones, was at his kitchen table when he learned last month that Elon Musk’s SpaceX had cut off access to Starlink terminals used by Russian forces. He scrambled for alternatives, but none offered unlimited internet, data plans were restrictive, and coverage did not extend to the areas of Ukraine where his unit operated. It’s not only American tech executives who are narrowing communications options for Russians. Days later, Russian authorities began slowing down access nationwide to the messaging app Telegram, the service that frontline troops use to coordinate directly with one another and bypass slower chains of command. “All military work goes through Telegram — all communication,” Anton, whose name has been changed because he fears government reprisal, told POLITICO in voice messages sent via the app. “That would be like shooting the entire Russian army in the head.” Telegram would be joining a home screen’s worth of apps that have become useless to Russians. Kremlin policymakers have already blocked or limited access to WhatsApp, along with parent company Meta’s Facebook and Instagram, Microsoft’s LinkedIn, Google’s YouTube, Apple’s FaceTime, Snapchat and X, which like SpaceX is owned by Musk. Encrypted messaging apps Signal and Discord, as well as Japanese-owned Viber, have been inaccessible since 2024. Last month, President Vladimir Putin signed a law requiring telecom operators to block cellular and fixed internet access at the request of the Federal Security Service. Shortly after it took effect on March 3, Moscow residents reported widespread problems with mobile internet, calls and text messages across all major operators for several days, with outages affecting mobile service and Wi-Fi even inside the State Duma. Those decisions have left Russians increasingly cut off from both the outside world and one another, complicating battlefield coordination and disrupting online communities that organize volunteer aid, fundraising and discussion of the war effort. Deepening digital isolation could turn Russia into something akin to “a large, nuclear-armed North Korea and a junior partner to China,” according to Alexander Gabuev, the Berlin-based director of the Carnegie Russia Eurasia Center. In April, the Kremlin is expected to escalate its campaign against Telegram — already one of Russia’s most popular messaging platforms, but now in the absence of other social-media options, a central hub for news, business and entertainment. It may block the platform altogether. That is likely to fuel an escalating struggle between state censorship and the tools people use to evade it, with Russia’s place in the world hanging in the balance. “It’s turned into a war,” said Mikhail Klimarev, executive director of the internet Protection Society, a digital rights group that monitors Russia’s censorship infrastructure. “A guerrilla war. They hunt down the VPNs they can see, they block them — and the ‘partisans’ run, build new bunkers, and come back.” THE APP THAT RUNS THE WAR On Feb. 4, SpaceX tightened the authentication system that Starlink terminals use to connect to its satellite network, introducing stricter verification for registered devices. The change effectively blocked many terminals operated by Russian units relying on unauthorized connections, cutting Starlink traffic inside Ukraine by roughly 75 percent, according to internet traffic analysis by Doug Madory, an analyst at the U.S. network monitoring firm Kentik. The move threw Russian operations into disarray, allowing Ukraine to make battlefield gains. Russia has turned to a workaround widely used before satellite internet was an option: laying fiber-optic lines, from rear areas toward frontline battlefield positions. Until then, Starlink terminals had allowed drone operators to stream live video through platforms such as Discord, which is officially blocked in Russia but still sometimes used by the Russian military via VPNs, to commanders at multiple levels. A battalion commander could watch an assault unfold in real time and issue corrections — “enemy ahead” or “turn left” — via radio or Telegram. What once required layers of approval could now happen in minutes. Satellite-connected messaging apps became the fastest way to transmit coordinates, imagery and targeting data. But on Feb. 10, Roskomnadzor, the Russian communications regulator, began slowing down Telegram for users across Russia, citing alleged violations of Russian law. Russian news outlet RBC reported, citing two sources, that authorities plan to shut down Telegram in early April — though not on the front line. In mid-February, Digital Development Minister Maksut Shadayev said the government did not yet intend to restrict Telegram at the front but hoped servicemen would gradually transition to other platforms. Kremlin spokesperson Dmitry Peskov said this week the company could avoid a full ban by complying with Russian legislation and maintaining what he described as “flexible contact” with authorities. Roskomnadzor has accused Telegram of failing to protect personal data, combat fraud and prevent its use by terrorists and criminals. Similar accusations have been directed at other foreign tech platforms. In 2022, a Russian court designated Meta an “extremist organization” after the company said it would temporarily allow posts calling for violence against Russian soldiers in the context of the Ukraine war — a decision authorities used to justify blocking Facebook and Instagram in Russia and increasing pressure on the company’s other services, including WhatsApp. Telegram founder Pavel Durov, a Russian-born entrepreneur now based in the United Arab Emirates, says the throttiling is being used as a pretext to push Russians toward a government-controlled messaging app designed for surveillance and political censorship. That app is MAX, which was launched in March 2025 and has been compared to China’s WeChat in its ambition to anchor a domestic digital ecosystem. Authorities are increasingly steering Russians toward MAX through employers, neighborhood chats and the government services portal Gosuslugi — where citizens retrieve documents, pay fines and book appointments — as well as through banks and retailers. The app’s developer, VK, reports rapid user growth, though those figures are difficult to independently verify. “They didn’t just leave people to fend for themselves — you could say they led them by the hand through that adaptation by offering alternatives,” said Levada Center pollster Denis Volkov, who has studied Russian attitudes toward technology use. The strategy, he said, has been to provide a Russian or state-backed alternative for the majority, while stopping short of fully criminalizing workarounds for more technologically savvy users who do not want to switch. Elena, a 38-year-old Yekaterinburg resident whose surname has been withheld because she fears government reprisal, said her daughter’s primary school moved official communication from WhatsApp to MAX without consulting parents. She keeps MAX installed on a separate tablet that remains mostly in a drawer — a version of what some Russians call a “MAXophone,” gadgets solely for that app, without any other data being left on those phones for the (very real) fear the government could access it. “It works badly. Messages are delayed. Notifications don’t come,” she said. “I don’t trust it … And this whole situation just makes people angry.” THE VPN ARMS RACE Unlike China’s centralized “Great Firewall,” which filters traffic at the country’s digital borders, Russia’s system operates internally. Internet providers are required to route traffic through state-installed deep packet inspection equipment capable of controlling and analyzing data flows in real time. “It’s not one wall,” Klimarev said. “It’s thousands of fences. You climb one, then there’s another.” The architecture allows authorities to slow services without formally banning them — a tactic used against YouTube before its web address was removed from government-run domain-name servers last month. Russian law explicitly provides government authority for blocking websites on grounds such as extremism, terrorism, illegal content or violations of data regulations, but it does not clearly define throttling — slowing traffic rather than blocking it outright — as a formal enforcement mechanism. “The slowdown isn’t described anywhere in legislation,” Klimarev said. “It’s pressure without procedure.” In September, Russia banned advertising for virtual private network services that citizens use to bypass government-imposed restrictions on certain apps or sites. By Klimarev’s estimate, roughly half of Russian internet users now know what a VPN is, and millions pay for one. Polling last year by the Levada Center, Russia’s only major independent pollster, suggests regular use is lower, finding about one-quarter of Russians said they have used VPN services. Russian courts can treat the use of anonymization tools as an aggravating factor in certain crimes — steps that signal growing pressure on circumvention technologies without formally outlawing them. In February, the Federal Antimonopoly Service opened what appears to be the first case against a media outlet for promoting a VPN after the regional publication Serditaya Chuvashiya advertised such a service on its Telegram channel. Surveys in recent years have shown that many Russians, particularly older citizens, support tighter internet regulation, often citing fraud, extremism and online safety. That sentiment gives authorities political space to tighten controls even when the restrictions are unpopular among more technologically savvy users. Even so, the slowdown of Telegram drew criticism from unlikely quarters, including Sergei Mironov, a longtime Kremlin ally and leader of the Just Russia party. In a statement posted on his Telegram channel on Feb. 11, he blasted the regulators behind the move as “idiots,” accusing them of undermining soldiers at the front. He said troops rely on the app to communicate with relatives and organize fundraising for the war effort, warning that restricting it could cost lives. While praising the state-backed messaging app MAX, he argued that Russians should be free to choose which platforms they use. Pro-war Telegram channels frame the government’s blocking techniques as sabotage of the war effort. Ivan Philippov, who tracks Russia’s influential military bloggers, said the reaction inside that ecosystem to news about Telegram has been visceral “rage.” Unlike Starlink, whose cutoff could be blamed on a foreign company, restrictions on Telegram are viewed as self-inflicted. Bloggers accuse regulators of undermining the war effort. Telegram is used not only for battlefield coordination but also for volunteer fundraising networks that provide basic logistics the state does not reliably cover — from transport vehicles and fuel to body armor, trench materials and even evacuation equipment. Telegram serves as the primary hub for donations and reporting back to supporters. “If you break Telegram inside Russia, you break fundraising,” Philippov said. “And without fundraising, a lot of units simply don’t function.” Few in that community trust MAX, citing technical flaws and privacy concerns. Because MAX operates under Russian data-retention laws and is integrated with state services, many assume their communications would be accessible to authorities. Philippov said the app’s prominent defenders are largely figures tied to state media or the presidential administration. “Among independent military bloggers, I haven’t seen a single person who supports it,” he said. Small groups of activists attempted to organize rallies in at least 11 Russian cities, including Moscow, Irkutsk and Novosibirsk, in defense of Telegram. Authorities rejected or obstructed most of the proposed demonstrations — in some cases citing pandemic-era restrictions, weather conditions or vague security concerns — and in several cases revoked previously issued permits. In Novosibirsk, police detained around 15 people ahead of a planned rally. Although a small number of protests were formally approved, no large-scale demonstrations ultimately took place. THE POWER TO PULL THE PLUG The new law signed last month allows Russia’s Federal Security Service to order telecom operators to block cellular and fixed internet access. Peskov, the Kremlin spokesman, said subsequent shutdowns of service in Moscow were linked to security measures aimed at protecting critical infrastructure and countering drone threats, adding that such limitations would remain in place “for as long as necessary.” In practice, the disruptions rarely amount to a total communications blackout. Most target mobile internet rather than all services, while voice calls and SMS often continue to function. Some domestic websites and apps — including government portals or banking services — may remain accessible through “whitelists,” meaning authorities allow certain services to keep operating even while broader internet access is restricted. The restrictions are typically localized and temporary, affecting specific regions or parts of cities rather than the entire country. Internet disruptions have increasingly become a tool of control beyond individual platforms. Research by the independent outlet Meduza and the monitoring project Na Svyazi has documented dozens of regional internet shutdowns and mobile network restrictions across Russia, with disruptions occurring regularly since May 2025. The communications shutdown, and uncertainty around where it will go next, is affecting life for citizens of all kinds, from the elderly struggling to contact family members abroad to tech-savvy users who juggle SIM cards and secondary phones to stay connected. Demand has risen for dated communication devices — including walkie-talkies, pagers and landline phones — along with paper maps as mobile networks become less reliable, according to retailers interviewed by RBC. “It feels like we’re isolating ourselves,” said Dmitry, 35, who splits his time between Moscow and Dubai and whose surname has been withheld to protect his identity under fear of governmental reprisal. “Like building a sovereign grave.” Those who track Russian public opinion say the pattern is consistent: irritation followed by adaptation. When Instagram and YouTube were blocked or slowed in recent years, their audiences shrank rapidly as users migrated to alternative services rather than mobilizing against the restrictions. For now, Russia’s digital tightening resembles managed escalation rather than total isolation. Officials deny plans for a full shutdown, and even critics say a complete severing would cripple banking, logistics and foreign trade. “It’s possible,” Klimarev said. “But if they do that, the internet won’t be the main problem anymore.”

A federal judge has quashed the Justice Department’s criminal probe into Federal Reserve Chair Jerome Powell’s Senate testimony regarding the central bank’s headquarters renovation, writing that the grand jury subpoenas were a “mere pretext” to pressure the Fed. “There is abundant evidence that the subpoenas’ dominant (if not sole) purpose is to harass and pressure Powell either to yield to the President or to resign and make way for a Fed Chair who will,” Chief U.S. District Judge James Boasberg wrote. “The Government has offered no evidence whatsoever that Powell committed any crime other than displeasing the President.” U.S. Attorney for D.C. Jeanine Pirro, whose office led the investigation, said in a press conference afterward that she would appeal the decision. She sharply criticized Boasberg, saying he “put himself at the entrance door to the grand jury, slamming that door shut, irrespective of the legal process, and thus preventing the grand jury from doing the work that it does.” “This process has been arbitrarily undermined by an activist judge,” she said. Pirro’s plan to appeal the decision could further delay the confirmation process of President Donald Trump’s pick to replace Powell, former Fed Gov. Kevin Warsh. Warsh’s nomination has been blocked by outgoing Sen. Thom Tillis until the investigation into Powell is resolved. The North Carolina Republican warned the administration on Friday afternoon against appealing the decision. “We all know how this is going to end, and the D.C. U.S. Attorney’s Office should save itself further embarrassment and move on,” Tillis posted on X. “Appealing the ruling will only delay the confirmation of Kevin Warsh as the next Fed Chair.” The White House did not immediately respond to a request for comment. Trump has severely criticized Powell for more than a year for his reluctance to lower interest rates, with the president accusing him of holding back the economy. Powell has said the subpoenas were part of Trump’s pressure campaign to force him to cut borrowing costs. The investigation into Powell’s testimony on the status of a costly renovation of the central bank’s headquarters kicked off a firestorm that threatens Trump’s aims to stack the Fed board with appointees who share his views on lowering short-term borrowing costs. Powell’s term as chair expires in May, and Pirro’s vow to appeal the decision could prolong a legal clash that will keep the Fed’s future leadership up in the air. Tillis, who has vowed to block any Fed picks until the Powell probe is publicly dropped, sits on the Senate Banking Committee, which has jurisdiction over Fed nominations. Republicans have a 13-11 majority on the committee, meaning that Tillis’s vote is needed to advance any nominee to the Senate floor if every Banking Committee Democrat votes against them. In a hearing before the committee last June, the panel’s chair, Tim Scott (R-SC), asked Powell about the status of the Fed’s renovations after a New York Post article characterized them as akin to the “Palace of Versailles.” Powell told senators that “there’s no new marble. There are no special elevators. There are no new water features. There’s no beehives, and there’s no roof terrace gardens.” That caught the eye of Federal Housing Finance Agency Director Bill Pulte, who urged lawmakers to look into the matter, and the White House launched its own probe into the project last summer. Several Senate Banking Republicans — including Scott — have said they do not believe Powell committed a crime with his testimony. Sen. Cynthia Lummis (R-Wyo.), a Powell critic, said in a statement that the Fed chief “was wildly underprepared for his testimony, but, as I have said before, I’m not sure it rose to the criminal level.” Wall Street executives and top lawmakers have repeatedly cautioned Trump against actions that might undermine the central bank’s ability to independently set interest rates, which bolsters its credibility and is viewed as a stabilizing force for global markets. Trump has also tried to fire Fed Gov. Lisa Cook over unsubstantiated allegations of mortgage fraud — her fate will be determined by the Supreme Court — and the president has flirted numerous times with attempting to dismiss Powell. In January, Powell posted an extraordinary two-minute video to the central bank’s website claiming that the DOJ’s subpoenas represented a politically motivated attempt to pressure the central bank into lowering interest rates. The threat of criminal charges was a “consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public, rather than following the preferences of the president,” he said. The move was unusual because Powell has steadfastly refused to respond to Trump’s blizzard of insults since he returned to the White House. The president has publicly questioned Powell’s intelligence and competence, and has said his monetary policy decisions are driven by politics. In her combative press conference, Pirro called the judge’s decision on Friday “outrageous.” She cited a Supreme Court precedent that grand juries can investigate mere rumors. And she dismissed suggestions that she should look skeptically at allegations that may be politically motivated. “I’ll take a case from the devil if you can give me information that will lead me to possibly find a crime,” she said. “It doesn’t matter where the case comes from.” While Pirro suggested it is exceptional for a judge to block a grand jury subpoena, federal court rules allow them to do so if they believe a subpoena is “unreasonable or oppressive.” In his ruling, issued Wednesday and unsealed on Friday, Boasberg noted that numerous court precedents authorize judges to quash a subpoena when its “sole or dominant” purpose is improper. Boasberg, an appointee of President Barack Obama, conceded that the subpoenas issued to the Fed were relevant to a criminal investigation. But he said their obvious connection to attempts to exert unlawful pressure on Powell and other members of the Fed’s Board of Governors rendered the subpoenas unenforceable. “The President spent years essentially asking if no one will rid him of this troublesome Fed Chair. He then suggested a specific line of investigation into him,” the judge wrote. “The President’s appointed prosecutor promptly complied.” Boasberg’s rejection of the subpoenas to the Fed is just the latest clash between the chief judge of the federal district court in the capital and the Trump administration. The judge’s earlier rulings in a dispute over Trump’s drive to rapidly deport alleged gang members under a two-century-old wartime authority led Trump to call for Boasberg’s impeachment. Some House members embarked on that effort last year, but it has not progressed. Pirro said that in addition to an appeal, which would go to the D.C. Circuit Court of Appeals, prosecutors intend to ask Boasberg to reconsider his ruling because it included some inaccurate dates. That could delay any appeal because judges typically cannot alter rulings while they are under appeal.

Paul Dallison writes Declassified, a weekly satirical column. The Bank of England’s announcement that historical figures will be replaced with wildlife on the next set of banknotes went down about as well as the phrase “I hope Germany win the World Cup” in an East End of London pub on a Friday night. The Bank held a public consultation on banknote imagery last year and the majority of respondents wanted nature on their notes (King Charles III will remain on the other side). On the current crop of notes are former Prime Minister Sir Winston Churchill (£5), author Jane Austen (£10), painter J.M.W. Turner (£20), and mathematician and computer scientist Alan Turing (£50). What was intended as a way to refresh the look of the currency while also bringing in new anti-counterfeit measures has developed into a full-blown culture war. On the BBC’s “Question Time” politics debate show, one audience member blamed the Greens for wanting to ditch wartime leader Winston Churchill, even though it has nothing to do with any political party. The issue even brought together political rivals Nigel Farage of Reform and Ed Davey of the Liberal Democrats, who both slammed the move, as did countless other “everything’s woke these days” talking heads. But what should really be on the Bank of England’s notes? What do English and Welsh people (the good folk of Scotland and Northern Ireland have their money issued separately, even if it’s all legal currency throughout the U.K.) want on their notes? Here’s what everyone can surely agree on and what the illustrations on the notes will look like (please send complaints to the Bank of England, Threadneedle Street, London)… A NICE CUP OF TEA Everyone loves a cup (or mug) of tea — and that’s English Breakfast Tea (or tea, as Brits call it) with milk, not Earl Grey or matcha or, heaven forbid, coffee. The only option available is sugar. The illustration on the notes will be a cup of tea served on a saucer with a spoon on one side and a biscuit (not a cookie!) on the other side for dunking. A LIST OF WHEN THE BINS GO OUT Nothing unites British people more than complaining about how infrequently the rubbish (or garbage, if you will) is collected. While a logistical challenge for the Bank of England (as every local authority has its own refuse rules), a list of what day you are supposed to put out your regular bin, your glass recycling bin and your garden waste would be a tremendous public service, accompanied by a drawing of some wheelie bins, one of which has been knocked over. DAVID ATTENBOROUGH The perfect link between the historical figures camp and the wildlife camp, everyone in the U.K. loves David Attenborough, the 99-year-old biologist and TV presenter whose programs are a byword for quality. The illustration would feature Attenborough holding delicately in his hands one of the U.K.’s most common types of wildlife, a pigeon with one leg and a parasitic skin condition. QUEUING TO SEE THE QUEEN There’s been no better example of Britishness in recent years than people forming an orderly queue to pay their respects to the late Queen Elizabeth II. At its longest, the wait time was more than 24 hours, and when two TV presenters — Phillip Schofield and Holly Willoughby — were seen accused of skipping the line, they faced a backlash from which they will never recover. The illustration would feature the queen lying in state with an enormous link snaking through London, ideally with people grumbling about the manners of their fellow queuers. CHICKEN TIKKA MASALA Yes, British people love fish and chips and various types of brown stew, but nothing says multicultural more than a mild curry believed to have been invented by a Pakistani-Scottish chef to appease a customer who complained that his food was too dry. The Illustration will be a curry with rice, naan and 18 pints of fizzy lager.

BRUSSELS — The EU’s six largest economies have thrown their weight behind plans to centralize oversight of some of Europe’s biggest financial companies under a single supervisor, according to a document obtained by POLITICO. The finance ministers of France, Germany, Italy, the Netherlands, Poland and Spain — the so-called “E6” group — backed the idea in a six-page letter addressed to the European Commission, the Eurogroup and the Council of the European Union. The letter outlined multiple initiatives and deadlines that Brussels should pursue this year. The goal is to create a deeper financial market to “strengthen Europe’s growth potential, enhance its economic sovereignty and provide a stronger foundation for financing common priorities,” the letter said. Among the most contentious initiatives is introducing EU supervision of “the most systemic, relevant, cross-border financial market infrastructures” amid firm resistance from a group of small countries, led by Ireland and Luxembourg, which rely on their outsized finance sectors and are reluctant to cede control to the EU level. EU leaders are set to discuss how best to speed up Brussels’ decade-long plans to create a U.S-style financial market next week after years of lackluster results amid vying national interests. Ireland has already sounded the alarm of the E6 group, as smaller countries fret that their views will be sidelined if countries club together to integrate their financial markets. In the letter, the E6 ministers said creating a “savings and investments union … has become an urgent strategic necessity” and that they commit to “taking action at European as well as at national level.” Other targets in the letter include reviving the bloc’s market for resold debt, or securitization, minting virtual euro banknotes, and introducing an EU-wide one-stop shop for founding companies, dubbed the 28th regime. There are also calls for greater transparency in stock markets and a push for a legislative package this year to streamline the EU’s financial rules. SEEKING A MAJORITY The idea of a single market watchdog, which would play a role similar to the European Central Bank’s supervisory arm for banking, has long been blocked at EU level due to the opposition of small countries and the lack of Germany’s backing. The support of the major economies is a breakthrough in the likelihood of agreeing to the plan, which the European Commission officially proposed in December but has been informally discussed since the financial crisis. The E6 countries wouldn’t be able to do it alone. They would first have to seek a “qualified majority” across the bloc to pass the proposal. That threshold requires the support of 15 countries that represent at least 65 percent of the EU. Should that fail, nine countries can pursue “enhanced cooperation” together to achieve their aims. The supervision plan would centralize oversight of large, cross-border financial plumbing firms, such as stock exchanges and clearinghouses, under the Paris-based European Securities and Markets Authority. The six countries stop short of fully endorsing the Commission’s December proposal, instead saying it “provides a solid basis for further discussion and allows us to work out the best possible solutions in the coming weeks.” The ministers call for EU countries to reach a political deal on the Commission’s plan by this summer.

Banknotes issued by the Bank of England will soon feature images of wildlife rather than historical figures, following a public consultation on the design of the next set of currency. On the current crop of notes are former Prime Minister Sir Winston Churchill (£5), author Jane Austen (£10), painter J.M.W. Turner (£20), and mathematician and computer scientist Alan Turing (£50). The Bank of England held a public consultation on banknote imagery last year. In a press release, it said that of the 44,000 responses received, about 60 percent wanted nature to feature, ahead of architecture and landmarks, historical figures, arts, culture and sport, innovation and noteworthy milestones. The bank said it will hold a second public consultation in the summer to gather views on the kind of nature that people would like to see featured on the notes, with a shortlist to be drawn up by a panel of wildlife experts. England is home to a range of wildlife, including foxes, badgers, beavers, squirrels, otters, deer and seals. The new notes won’t enter circulation for several years. Victoria Cleland, chief cashier at the Bank of England, said: “The key driver for introducing a new banknote series is always to increase counterfeit resilience, but it also provides an opportunity to celebrate different aspects of the U.K.” “Nature is a great choice from a banknote authentication perspective, and means we can showcase the U.K.’s rich and varied wildlife on the next series of banknotes.” King Charles III will remain on the front of the notes. The highest note issued by the Bank of England is £50. Due to massive hyperinflation in 2008, the Reserve Bank of Zimbabwe issued a one-hundred-trillion-dollar banknote.

LONDON — Britain has announced the largest package of sanctions against Russia since the early days of the Ukraine war to mark four years since the full-scale invasion. The U.K. government on Tuesday targeted dozens of companies and individuals across Russia’s military, energy and banking sectors as Western countries attempt to pile pressure on Russian President Vladimir Putin’s war economy. The list includes nuclear and gas companies, and banks processing cross-border payments that help Russia avoid existing U.K. sanctions. Britain is also targeting Russia’s shadow fleet — oil tankers used to evade sanctions which have been surveilled, intercepted and boarded by the U.K. and its allies. It is sanctioning 48 vessels and 175 companies in Russia’s “2Rivers” illicit oil network — a move the U.K. Foreign Office said will send a “clear” message that “Russian oil is off the market.” U.K. Foreign Secretary Yvette Cooper is in Kyiv Monday to mark the anniversary of the invasion. She said: “The UK has today taken decisive action to disrupt the critical financing, military equipment and revenue streams that sustain Russia’s aggression, in our largest raft of measures since the early months of the invasion.”

Christine Lagarde said her “baseline” is that she will stay at the European Central Bank until her term as president ends in October 2027. “I think that we have accomplished a lot, that I have accomplished a lot,” she said in an interview with The Wall Street Journal, published on Friday. “We need to consolidate and make sure that this is really solid and reliable. So my baseline is that it will take until the end of my term.” Her comments come two days after a report in the FT, sourced to a single person “familiar with her thinking,” suggested the opposite. The article triggered controversy, implying that the appointment of the next ECB president could be moved up to deny a possible far-right president in France any say in the matter. President Emmanuel Macron is due to step down in April next year. Lagarde played down suggestions she would be complicit in undermining the independence of the ECB from political influence by going along with any such plan. “The ECB is a very respected and credible institution, and I hope that I’ve participated in that,” she said. Lagarde’s comments to The Wall Street Journal are the latest in a series of carefully caveated statements about her future that have generally left her some wiggle room. She confirmed that she is already thinking about her next move, telling the paper that “one of the many options” she is looking at is to take over running the World Economic Forum. The WEF’s founder Klaus Schwab said last year he had discussed the possibility of her leaving the Bank early to succeed him in Davos.

LONDON — A Reform UK government would keep the Office for Budget Responsibility and maintain the independence of the Bank of England, Robert Jenrick, the party’s new “shadow chancellor,” will say at an event in the City of London Wednesday. Jenrick was only appointed to the role – which makes him the Treasury spokesperson for the right-wing populist party leading in British polls — Tuesday. Already, he’s being sent out to tell figures and journalists in London’s financial powerhouse that Reform would back the two totemic economic institutions. It’s an effort to reassure investors and businesses that Reform can be trusted with the British economy. It was only last month that his party leader, Nigel Farage, told the World Economic Forum in Davos he doesn’t like banks, would scrap interest payments lenders receive through the BoE’s quantitative easing program, and refused to rule out appointing his own governor to the central bank. Earlier this year Farage stated that he was giving “serious thought” to scrapping the OBR, which provides independent analysis of government spending plans. In November, Farage and his deputy Richard Tice U-turned on a plan to dish out £90 billion in tax cuts, which was initially pledged in the party’s 2024 election manifesto. Jenrick will vow Wednesday that Reform UK will be focused on “restoring stability” and “eliminating wasteful spending.” Although Jenrick will claim that the BoE would keep its independence under a Farage government, he will add that the Bank would be stripped of “ancillary responsibilities,” such as considering the impact of climate change, and will follow his leader in having a crack at the institution for “excessive quantitative easing” and “taking its eye off the ball on inflation.” He’ll say the Bank’s rate-setting committee must have private sector representation, and say the OBR will have to open itself up to more “outside, proven forecasting expertise,” too. “The OBR is far from perfect,” he will say. “But the impetus for its creation was a desire to instill fiscal discipline, and that is something we wholeheartedly endorse. Rather than abolish it, we will reform it. We will break up this cosy consensus and ensure it has diversity of opinion,” Jenrick will say today. “We will demand that the Bank is a more open institution, and the private sector better represented on the Monetary Policy Committee.” In previous statements, Farage has also been a critic of City watchdog the Financial Conduct Authority, hinting that he wants to strip the FCA of its power to regulate the banking industry, and slamming its approach to crypto regulation. However, there was no mention of the FCA in Reform’s preview of Jenrick’s speech released by the party. Britain’s possible future chancellor is only a fledgling Reform MP, after planning to defect from the Conservative Party in mid-January — and then being kicked out after Tory Leader Kemi Badenoch discovered he was a flight risk. Farage announced Jenrick, a former Conservative housing secretary, and exchequer secretary to the Treasury in Theresa May’s government, would get the top Treasury job in a would-be Reform government at an unveiling event Tuesday. The title, “shadow chancellor,” is one normal used by the official opposition in the U.K., so the badging is being seen as a power play by Farage’s team as it tries to replace the Tories. Jenrick said Tuesday that he intends to “get out to talk to businesses in the City and, frankly, right across the country,” so that Reform and the sector can have a “productive relationship.”