Russia Again Shells Western Areas Near Lviv

Russian missiles again hit areas in the far west of Ukraine, including near the airport at Lviv, the mayor said. It was the first reported strike in some days in regions close to the Polish border that are a key corridor for Ukrainians attempting to flee to Poland.

President Vladimir Putin proposed a new term for Bank of Russia Governor Elvira Nabiullina, hours before the central bank is due to announce its first rate decision since the invasion of Ukraine.

President Joe Biden will tell Chinese counterpart Xi Jinping the US will “impose costs” if Beijing backs Russia, in a call planned for 9 am EDT, Secretary of State Antony Blinken said. The Pentagon warned that Russia may become more reliant on its nuclear deterrent as the conflict and sanctions weaken its conventional forces.

Ukraine Update: Russia Again Shells Western Areas Near Lviv

(See RSAN on the Bloomberg Terminal for the Russian Sanctions Dashboard.)

Oil Extends Gains as Peace Talks Seem to Stall (8:40 am)

Oil extended gains after the biggest daily surge in 16 months pushed prices back above $ 100 a barrel as the Kremlin cast doubt on the progress of peace talks with Ukraine. US and European equity futures declined and Asian stocks were steady.

Putin Proposes Another Term for Central Bank Chief (8:11 am)

Vladimir Putin has proposed another term for Elvira Nabiullina as head of the Russian central bank. The move comes hours before the Bank of Russia announces its first rate decision since the invasion of Ukraine led to sweeping sanctions and handcuffed the central bank after the seizure of an estimated two-thirds of its $ 643 billion in foreign reserves. Nabiullina has led the bank since 2013.

Crisis-Mode Central Bank of Russia to Keep Rate at 20%

The central bank is set to keep the benchmark at the highest in almost two decades, following an emergency hike that more than doubled the key rate to 20%.

Russian Shells Again Land in Western Ukraine (7:15 am)

Lviv mayor Andriy Sadovy said on Telegram that Russian missiles landed near the airport, although they missed the airfield. The western city close to the Polish border has become a gathering point for people fleeing the conflict to Poland, and for humanitarian aid going into Ukraine.

The Ukraine army downed seven jets and three drones in the past 24 hours, and targeted military convoys, the General Staff of the armed forces said on Facebook.

In a morning update Russia’s defense ministry said it has captured 90% of territory in the Luhansk region, and is now fighting in the center of the southeast city of Mariupol.

Default Risk Falls As Bond Payment Send (7:05 am)

The cost of insuring Russian debt against default dropped and bond prices rose after people familiar with the matter said funds earmarked for interest payments on the Russian government dollar notes were sent to the payment agent.

JPMorgan Chase & Co. has processed the funds and sent the money on to Citigroup Inc., the people said, spurring optimism that the bonds may still be settled in dollars.

Tokyo Poised to Receive Ukrainian Refugees (7 am)

Tokyo is set to welcome and provide apartments for its first Ukrainian refugees, Governor Yuriko Koike said in an interview with Bloomberg Television.

Prime Minister Fumio Kishida, whose government has been quick to show solidarity with the US and Europe by imposing sanctions on Russia, has set up a task force to coordinate offers from local governments to host refugees.

Sunak Warns on Economic Hit From Oil Ban (6:32 am)

UK Chancellor of the Exchequer Rishi Sunak estimated that an immediate EU-wide ban on Russian oil and gas imports would result in a hit to the economy of 70-75 billion pounds, the Financial Times reported, citing unidentified officials.

Sunak, who made the comments in a cabinet meeting last week, said an immediate total EU ban would tip economies across Europe into recession, including the UK

China Ramps Up Purchases of US Corn (6:27 am)

China scooped up 200,000 tons of US corn last week for shipment in the season beginning Sept. 1, Department of Agriculture data showed, the most since December. China was only the fourth-largest buyer for the week, but the sale was notable since the Asian country had been getting supplies from Ukraine.

Russia’s invasion has snarled grain exports and put spring plantings in doubt, pushing prices higher in Chicago.

German Vice Chancellor ‘Would Go to Kyiv’ (6 am)

German Vice Chancellor Robert Habeck said he would be prepared to follow some eastern European leaders and travel to Kyiv to demonstrate support for Ukraine. The prime ministers of Poland, the Czech Republic and Slovenia traveled to Kyiv on Tuesday to meet President Volodymyr Zelenskiy.

Ukraine Update: Russia Again Shells Western Areas Near Lviv

China, Russia Officials Discuss Ties (3:42 am)

Russia’s ambassador to China, Andrey Denisov, met with Chinese Foreign Ministry official Cheng Guoping on Thursday, the ministry in Beijing said. The two exchanged views on their nations’ relationship, but there were no further details.

China has been struggling to balance its close diplomatic partnership with its neighbor, and their shared opposition to US dominance, with its long-professed support for protecting the sovereignty of independent nations.

Japan, Australia Expand Sanctions (2:55 am)

Japan added 15 individuals to its list of sanctions subject to asset freeze, including eight deputy defense ministers. It also hit nine entities including aircraft refueling services firm Rosneft Aero with punishments.

The Australian government announced sanctions on oligarchs Oleg Deripaska and Viktor Vekselberg, who both do business in the country. Foreign Minister Marise Payne said the new measures will target 11 Russian banks and government entities, including the Russian National Wealth Fund and the Ministry of Finance.

Zelenskiy Praises US for Latest Military Aid (12:25 am)

Ukrainian President Volodymyr Zelenskiy praised the latest wave of military assistance from the US and declined to provide details of his country’s negotiating tactics with Russia.

Zelenskiy, in his nightly video address, also said a government lending program would provide companies as much as 60 million hryvnia, or $ 2 million. The loans would be zero-interest until one month after the end of the war. Then, the annual interest rate would be set at 5%, he added.

Ukraine Update: Russia Again Shells Western Areas Near Lviv

S&P Says Russia Debt ‘Highly Vulnerable to Nonpayment’ (10:45 pm)

S&P Global Ratings said Russian debt is “highly vulnerable to nonpayment” as it cut the country’s rating to CC, two steps above default.

Earlier Thursday, reports suggested that interest payments due this week on Russian government dollar bonds may be moving forward. JPMorgan Chase & Co., the correspondent bank used by Russia, has processed funds earmarked for the payments and sent the money on to Citigroup Inc. which is acting as payment agent, according to people familiar with the matter. Representatives for JPMorgan and Citigroup declined to comment.

Pentagon Says Putin May Threaten to Use Nuclear Weapons (9:40 pm)

President Vladimir Putin can be expected to brandish threats to use nuclear weapons against the West, as the war in Ukraine and its economic consequences weaken Russia’s conventional military strength over time, according to the Pentagon’s Defense Intelligence Agency.

“Russia will likely increasingly rely on its nuclear deterrent to signal the West and project strength to its internal and external audiences,” according to a new DIA assessment prepared for the House Armed Services Committee.

US House Votes to End Russia’s Favored Trade Status (8:36 pm)

The US House of Representatives voted overwhelmingly to end regular trade relations with Russia in a move that would allow the US to sharply raise tariffs on Russian goods entering the country.

The bill, passed 424-8, would end what’s known as Most Favored Nation status for Russia, putting it in a category with other pariah states like North Korea and Cuba. The legislation would allow the US to hit Russia with significantly higher tariffs than those it applies to other World Trade Organization members.

Ukraine Update: Russia Again Shells Western Areas Near Lviv

Biden Will Press Xi Not to Back Putin’s War (7:51 pm)

Biden will tell Xi in a call Friday that China “will bear responsibility” if it backs Russia, and should use its influence with Putin to “defend the international rules and principles that it professes to support,” Blinken told reporters. He said the US is concerned that China may provide military assistance to Russia. Moscow and Beijing have denied US reports that such aid has been requested by the Kremlin.

Pressed over whether there could ever be normal ties with Putin after the war ends, Blinken demurred, saying only that there will have to be accountability for the conflict.

Ukraine Update: Russia Again Shells Western Areas Near Lviv

Germany Suggests Air Corridors for Refugees (7:11 pm)

German Foreign Minister Annalena Baerbock called for an air corridor by Western allies for Ukrainian refugees, especially in Moldova. “We now need a common solidarity air bridge within Europe, but also across the Atlantic,” Baerbock said after a meeting with NATO chief Jens Stoltenberg in Berlin.

She also announced that Germany will send more troops to strengthen NATO’s eastern flank but did not offer any details.

Ex-US Defense Chief Says It’s a Proxy War With Russia (6:13 pm)

The US is fighting a proxy war with Russia “whether we say so or not” and should “provide as much military aid” as possible to Ukrainian fighters, former Secretary of Defense Leon Panetta said Thursday on Bloomberg Television’s “Balance of Power with David Westin . ”

“Diplomacy is going nowhere unless we have leverage,” said Panetta, who also served as director of the Central Intelligence Agency. “The way you get leverage is by, frankly, going in and killing Russians.”

Ukraine Update: Russia Again Shells Western Areas Near Lviv

Panetta did not specify what types of military aid the US should give Ukraine but said the only way to persuade Putin “that he should take some kind of an off-ramp is to continue to beat him on the battlefield.”

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