US President Donald Trump arrives in Beijing today, but his ambitions for the high-stakes summit with Chinese leader Xi Jinping are reduced.

In his 2024 campaign, Trump promised to hit China harder with tariffs than any other country, but has ended up more cautious; plans to push it to restructure its economy have given way to ensuring stable relations, The New York Times reported. China has changed since his 2017 visit, an expert wrote in the Financial Times: It is confident in its place as a global leader, and expects to extract concessions of its own from Washington. Xi will have his own agenda items — notably Taiwan, which China’s foreign minister recently called “the biggest risk in … relations.”

Iran retains access to the majority of its missile sites along the Strait of Hormuz, according to new US intelligence that contradicts previous White House statements.

The new assessment, which has been shared with lawmakers behind closed doors, suggests Iran has rebuilt operational capacity at 30 of 33 missile sites along the strait, cementing its effective control over the key waterway, The New York Times reported.

US President Donald Trump has said that Tehran’s military has been decimated, and on Tuesday insisted Washington did not “need any help” reopening the strait, despite its closure already having led to over 1 billion barrels of oil in lost supply. The energy shock caused by the blockade has prompted renewed warnings of an impending global fuel shortfall this summer.

The prolonged closure of the Strait of Hormuz has accelerated fears of an impending food crisis in some of the world’s poorest countries, with tens of millions of people at risk.

Small-scale farmers across Africa — responsible for feeding much of the continent — are struggling amid a shortfall of diesel and fertilizer; some are worried they will miss the planting season if supplies aren’t bolstered soon.

The UN has issued stark warnings, including of possible famines, as the Iran war compounds the toll for countries already racing to plug gaps left by the sudden cut of US and European aid. “My biggest worry this year is not even just price, but availability,” a nonprofit worker in Malawi told Bloomberg.

Russia cut its growth forecast for the year from 1.3% to 0.4%, further signs of the country’s faltering war economy. Businesses are increasingly struggling to pay their debts, Fortune reported, with growing defaults threatening a quarter of the bond market.

Punishingly high borrowing costs have damaged manufacturing and business investment but failed to slow inflation, driven by huge military spending and a shortage of labor caused by military recruitment.

Moscow’s energy revenues are down 40% year-on-year despite the Iran war pushing up oil prices, partly because Ukrainian drone attacks have crippled Russian refinery capacity.

A Russian ship reportedly carrying two nuclear reactors bound for North Korea sank in mysterious circumstances off the coast of Spain, a CNN investigation found.

The 2024 sinking of the Ursa Major — which the outlet said had a hole in its bow with the damaged metal facing inward, suggesting a potential strike — occurred just months after Pyongyang began assisting Moscow in its war against Ukraine.

Meanwhile, satellite images showed that a bridge connecting Russia to North Korea was nearing completion, the latest sign of warming ties between the nuclear-armed nations, which has sparked uneasiness from China, long Pyongyang’s protector. Despite that displeasure, “North Korea’s ties with Russia look to continue beyond any end to the Ukraine war,” an expert said.

The CIA reportedly killed a cartel boss in a secret operation in Mexico, the latest sign of Washington’s increased interference in Latin American security.

US President Donald Trump has made stopping drug flows across the southern border and cracking down on cartels a priority in his second term. The moves his administration has taken are unprecedented: This year alone, the US has struck dozens of boats allegedly carrying drugs in the Caribbean; ousted the former president of Venezuela it accused of running a cartel; and charged a Mexican governor with drug trafficking.

However, experts warn Washington’s renewed war on drugs could lead to more violence across Latin America, risking further migration waves to the US — thereby undermining another Trump priority.

US inflation jumped to 3.8% in April, its highest level since 2023, largely driven by surging fuel prices sparked by the Iran war. Core inflation, which removes volatile energy and food prices, also rose to 2.8%.

“US inflation is close to peaking, but that does not mean relief is imminent,” an economist told the Financial Times, adding that unpredictable oil prices could lead to a more persistent energy shock.

A survey of chief executives published Monday showed that, on average, they expect to see inflation running at 3.7% over the next year.

The data comes at a critical moment for the US Federal Reserve, as incoming chair Kevin Warsh will be caught between fighting higher prices and US President Donald Trump’s calls to cut interest rates. 

US President Donald Trump on Tuesday said Iran must strike a deal or “be decimated,” as Gulf nations’ involvement in the war came into clearer view.

The warning, which Trump issued as he departed for Beijing, underscored the fragility of the ceasefire with Tehran and the stalemate in the Strait of Hormuz.

Trump is facing swelling bipartisan frustration from lawmakers over the war, as the conflict’s cost ballooned to $29 billion.

The hostilities have also drawn in the broader region: Following a report that the UAE secretly attacked Iran last month, Reuters reported Tuesday that Saudi Arabia launched unpublicized strikes against the Islamic Republic, while Kuwait accused Iranian forces of trying to infiltrate its territory on May 1.

AI is on the agenda for the Donald Trump-Xi Jinping summit this week, but analysts say it’s unlikely Beijing will cave on agreeing to significant guardrails around the technology.

The meeting comes as both countries race to create and adopt new AI models amid mounting cybersecurity fears. Anthropic last month refused to give Beijing access to its new too-risky-to-release model, The New York Times reported, a sign of how the superpowers’ deepening tech rivalry could imperil their leaders’ talks on AI safety.

Investors are expecting trade tensions to be on the backburner at the summit, and are focused instead on possible chip export control discussions, Reuters wrote. “The only thing worth monitoring is development around AI,” a Beijing-based fund manager said.

The yuan hovered near a three-year high against the dollar Tuesday, buoyed by expectations of stronger US-China ties ahead of this week’s meeting between the countries’ leaders.

Goldman Sachs analysts said China’s currency remains more than 20% undervalued and will keep strengthening this year, and a summit that stabilizes trade ties could accelerate its climb.

An “intensifying currency war” is simmering between the two superpowers, The New York Times wrote, as Beijing eyes a larger international role for the yuan, while the US looks to defend the dollar’s position as the world’s reserve currency.

Washington has discussed currency swaps with Gulf and Asia partners in an effort to entrench dollar dominance, a strategy the US Treasury secretary said would strengthen “America’s economic shield.”

Foreign investors have pulled $21 billion out of Indian stocks in the last two months, putting 2026 on track to be the worst year for outflows since the markets opened to overseas investment in 1993.

Investors are instead looking to South Korea and Taiwan, where stocks are booming on the back of AI chip demand.

India has also been hit especially hard by the ripple effects of the Iran war, with New Delhi recently urging Indians to travel less and stop buying gold. The rupee has weakened considerably.

Adding to the markets’ pain: The digital arm of Reliance Industries is now rethinking its IPO, which was set to let existing investors cash out, but will instead be a fresh share sale to avoid worsening outflows.

The head of OpenAI is facing heightened scrutiny thanks to a lawsuit from Elon Musk and a massive, planned IPO.

Sam Altman took the stand Tuesday in the trial against Musk; the Tesla CEO, who also co-founded OpenAI, has accused the AI startup of betraying its original nonprofit mission. Musk has looked to portray Altman as deeply untrustworthy. It’s “a little bit unfortunate for the AI industry at a time when the public perception of AI is quite negative,” a tech policy expert said.

Republican lawmakers are also probing Altman’s personal investments ahead of the IPO, after the Wall Street Journal reported that he sought to have OpenAI back companies he also personally invested in.

A top South Korean official proposed that citizens should share in the profits of the country’s AI chip boom.

Samsung and SK Hynix have seen huge profits and soaring share prices as demand for semiconductors surges. Kim Yong-beom’s suggestion that some of that windfall should be redistributed to support basic income programs for rural communities and startup funding for young people, spooked investors, but AI leaders themselves have suggested similar proposals.

Anthropic’s Dario Amodei, Google DeepMind’s Demis Hassabis, OpenAI’s Sam Altman, and Elon Musk have suggested some sort of universal basic income (or “universal high income,” in some formulations) funded by taxes on AI companies.

Bill Gates, back in 2017, floated a “robot tax” on companies automating workers’ jobs away.

The Iran war, frozen in a shaky ceasefire, appeared to expand and envelop more belligerents.

US intelligence said that Pakistan allowed Iran to use its bases for military aircraft despite its role as a mediator in negotiations, CBS reported, while the UAE — which has been more anti-Iran than any other Gulf state since the conflict began — secretly struck Iranian targets last month in retaliation for attacks on civilian infrastructure, according to The Wall Street Journal.

And talks between Washington and Tehran appear to be going nowhere, with US President Donald Trump rejecting a recent Iranian peace proposal, leaving the war in “a gray zone that is neither war nor peace.”

More than a dozen CEOs, including top tech and finance leaders, were invited to join US President Donald Trump on his visit to China this week, according to a White House official.

The list includes Apple’s Tim Cook, Tesla’s Elon Musk, and Goldman Sachs’ David Solomon, along with the CEOs of Boeing and agricultural giant Cargill. The US is likely to announce a deal for China to buy more Boeing jets and American soybeans.

Not all of the invited executives may end up attending; Cisco said its CEO, Chuck Robbins, won’t make it because of earnings this week.

Trump had stoked a sense of “corporate FOMO” among executives through offhand comments about the trip, Semafor reported last week.

Nvidia CEO Jensen Huang did not get an invite because the White House wants to focus more on agriculture and aviation, Reuters reported. Nvidia has become a major geopolitical bargaining chip between the two superpowers; Washington most recently eased export controls on some of Nvidia’s most high-powered chips.

Also absent from the invite list are oil and gas CEOs, as the global energy sector feels the squeeze from Iran war-related supply disruptions.

Instead, Trump invited companies “that would benefit, broadly, from an open door to China,” Semafor’s Ben Smith wrote Monday. “In Donald Trump’s personalist Washington, these big American companies — with the possibility they bring big deals and big investments — tend to drive policy far more than any broader strategy or ideology.”

Here is the full invite list:

• Apple (Tim Cook)
• BlackRock (Larry Fink)
• Blackstone (Stephen Schwarzman)
• Boeing (Kelly Ortberg)
• Cargill (Brian Sikes)
• Citi (Jane Fraser)
• Cisco (Chuck Robbins)
• Coherent (Jim Anderson)
• GE Aerospace (H Lawrence Culp)
• Goldman Sachs (David Solomon)
• Illumina (Jacob Thaysen)
• Mastercard (Michael Miebach)
• Meta (Dina Powell McCormick)
• Micron (Sanjay Mehrotra)
• Qualcomm (Cristiano Amon)
• Tesla / SpaceX (Elon Musk)
• Visa (Ryan McInerney)

UK government bond yields rose to their highest levels in decades with Prime Minister Keir Starmer’s leadership hanging by a thread.

Disastrous local election results for Starmer’s Labour Party have led to 70 lawmakers — including members of his cabinet — calling for him to resign; populist parties on both left and right made huge gains.

Labour won a landslide less than two years ago, but instability is normal now, the BBC’s political editor wrote: By the time he was 27, the UK had had four prime ministers; there have been four in the past four years, and likely another soon. That instability is spooking investors, hence the high gilt yields, on top of Britain’s long-term lack of economic growth.

Headline figures are understating both the cost and the benefits of AI, Goldman Sachs said.

The narrative so far has focused on capex — $400 billion on data centers and other infrastructure last year, likely $700 billion this year. But an equivalent non-hardware spend, on intangible capital such as workflow reorganization and software, is ramping up in parallel, bank economists said in a note to clients.

Those investments are usually not recorded as investment and appear as pure cost, masking productivity gains. Companies are trying to reorganize their business models to incorporate AI agents, but incentivizing or mandating it can create perverse incentives: Amazon staff are apparently using its in-house agent for unnecessary tasks to inflate usage scores, the Financial Times reported.

OpenAI launched its own cybersecurity initiative in response to Anthropic’s.

The ChatGPT-maker’s recent GPT-5.5-Cyber model, like Anthropic’s Mythos, can detect vulnerabilities in most software. Mythos was only released to a select few organizations to help them patch problems; OpenAI will do likewise.

Almost all the institutions with access to Mythos have been US-based, and Europe is worried about being behind the security curve as open-source cyber-capable models reach hostile actors.

Europe’s strict tech regulation might be a factor: The EU is considering banning US tech giants from handling government data, which may not encourage those same firms to offer their services to strengthen European cybersecurity.

Major Hollywood studios are largely avoiding this year’s Cannes Film Festival, which opens today.

The event is traditionally a showcase for some of the year’s biggest movies, and is “Hollywood’s most glamorous overseas outpost,” per The Guardian. But this year, only two American entrants are competing for the Palme d’Or, both relatively small and financed outside the US.

Premiering a film at a festival takes marketing control out of the studios’ hands, one industry reporter said: The 2023 Indiana Jones reboot was trashed by Cannes critics, and then underperformed at the box office.

Hollywood’s absence has left the field open to international auteurs — Pedro Almodóvar’s return is particularly exciting attendees — but the festival’s director said “I hope the studio films come back.”

Costa Rica’s new president vowed to build a new mega-prison, becoming the latest Latin American leader to draw inspiration from Salvadoran President Nayib Bukele’s brutal, though effective, approach to crime.

Laura Fernández said her “hand would not tremble” when it came to tackling gangs: Violence in Costa Rica — long held as one of the few Latin American countries devoid of large-scale organized crime — has skyrocketed in recent years, with the homicide rate tripling from the start of the century.

As violence rises across much of the region over a surge in cocaine production, Chile and Ecuador, among others, have vowed to mimic El Salvador’s approach, which has included mass arrests and huge detention facilities.

Beijing has a strong hand to play against US President Donald Trump in this week’s summit, analysts said.

Chinese leader Xi Jinping has “displayed confidence in going toe-to-toe” with Trump, The Washington Post wrote, while China is “locked and loaded” for another economic fight, an expert told The New York Times.

China has the upper hand because of its dominance in rare earths and diplomatic leverage in the Iran war, which could allow Beijing to extract concessions, a prominent commentator argued.

Trump’s advisers are “concerned he’s heading into a summit he’s not adequately prepared for,” Eurasia Group’s Ian Bremmer wrote in a note.

But Washington still has an advantage through its superiority in chips and AI, a former US diplomat argued.

US President Donald Trump said Washington’s ceasefire with Tehran is on “massive life support,” a day after he rejected Iran’s terms for ending the war and reopening the Strait of Hormuz.

Oil prices ticked back up on Monday as the countries’ standoff deepened; both sides have signaled they are dug in on their stances.

It’s unclear whether Trump would resume military attacks on Iran, though the US Navy advertised the arrival of a nuclear-armed submarine near the Mediterranean, widely interpreted as a warning to Tehran.

As concerns over global energy supply ballooned, Trump on Monday backed suspending the federal gas tax to ease the strain on Americans’ wallets at the pump.

The AI boom is pushing East Asian stock markets to record highs even as their economies feel the pain of wartime supply disruptions.

JPMorgan Chase on Monday lifted its target for South Korean stocks on surging AI-related demand for semiconductors. Asia’s three most valuable firms are chipmakers: Some investors are pouring into those companies on the belief that they already make money from AI, Reuters wrote, in contrast to doubts over the payoff from their American counterparts’ massive AI spending.

Still, the dynamic in South Korea, Japan, and Taiwan somewhat mirrors the US, in which tech is propping up equity markets even as broad economic uncertainty persists because of the Iran war.

Spain called for the creation of an EU army, part of a broader shift toward European sovereignty.

“We cannot be waking up every morning wondering what the US will do next,” the country’s foreign minister told Politico.

Calls for European armies date back to the 1950s, but the wars in Ukraine and Iran have made it politically more palatable and financially more viable, with Brussels and member states readying $943 billlon in defense spending by 2030.

Tech will be more difficult to decouple: European businesses are reliant on US digital services, and Washington is increasingly using that leverage. “The scale of Europe’s dependence… is only just beginning to dawn on citizens and policymakers,” the Financial Times reported.

Airlines are lowering prices for some European flights after customers hesitated to book tickets amid the Iran war.

Fears of a jet fuel shortage — and subsequent flight cuts and airfare hikes — have led many to hold off on booking summer travel. But a Financial Times analysis of flights to popular Southern European destinations suggests airlines are now trying to incentivize buyers with lower fares.

Some US airlines have raised fares because of the fuel crunch, but experts say demand remains strong among Americans for summer trips. Rather than give up travel altogether, many consumers are instead looking for lower-budget options.

Google said it identified a cyberattack that relied on AI to detect a previously unknown bug.

The tech giant said it’s the first time it has seen AI involved in a “zero-day attack,” which exploits a vulnerability that the company was unaware of.

“We believe this is the tip of the iceberg,” a Google security analyst said. Experts, as well as AI companies themselves, have warned of the danger that advanced AI systems could pose to cyber defenses; Anthropic held off on releasing its latest model for that exact reason.

While such fears could push the US and China — fierce technological rivals — to discuss AI safety, Beijing has little incentive to slow down, Semafor’s tech editor noted.

A further prolonging of the Strait of Hormuz closure risks a historic energy shock, analysts warned.

Despite a disruption of almost 1 billion barrels of oil, crude prices have remained below their 2022 peak, thanks to large reserves, US exports, and expectations that the strait would reopen. Morgan Stanley said if no agreement was reached by late June, oil could exceed $130 a barrel.

JPMorgan, meanwhile, said in a note that crude shortages would most impact refined products, and forecast that US pump prices could hit $5 a gallon, up from below $3 in February. The US energy secretary refused to rule out the possibility and floated suspending gasoline taxes. Asian nations are turning to coal, the Financial Times reported.

The Iran war will likely overshadow a litany of bilateral disputes during talks between US President Donald Trump and Chinese leader Xi Jinping this week.

Washington and Beijing disagree on issues including defense, technology, and trade, with tensions between the superpowers ratcheting up in recent weeks: The US has sanctioned Chinese refineries, while Beijing has tightened rules on supply chains.

But the Middle East conflict is sapping Trump’s power, The Wall Street Journal wrote, and he will push China to use its leverage over Iran to agree a truce. US officials have nevertheless sought to temper expectations over making any significant progress on that, or indeed any other key issue.

The Iran war is hitting Asia’s economies. A third of the world’s urea fertilizer supply has been “wiped out,” one analyst told The Washington Post, and prices are up 40%. Accordingly, farmers in Southeast Asia are choosing to skip or cut back on planting this season, or lower fertilizer use, likely leading to reduced yields and increased food prices.

The continent faces energy shortages too. Indian Prime Minister Narendra Modi told citizens to curb fuel use by working from home and taking public transport: Until now the government has borne the brunt of price increases, but with state elections over, “Modi can be more realistic about the economic issues,” an analyst told the Financial Times.

China last month exported more EVs and plug-in hybrids than gasoline and diesel cars combined for the first time, underscoring the country’s growing global dominance in clean energy transport.

While domestic sales have contracted, international demand remains robust, with so-called new-energy vehicle exports rising to 400,000 in April despite Western countries imposing import restrictions.

Meanwhile, falling prices sparked by excessive competition in the industry — China has more than 100 EV manufacturers — have helped spark a rapid transition to low-emissions cars even in low-income nations: Although from a low base, the number of EVs in Bolivia has grown almost sixfold in the last five years, with many buyers turning to Chinese imports.

Authorities are tracing more than 90 passengers exposed to hantavirus who disembarked from the cruise ship hit by a deadly outbreak, two of whom already tested positive.

The World Health Organization recommends a 42-day quarantine after exposure to the virus, which usually spreads via rodent feces but sometimes human-to-human, because symptoms can be slow to appear. But dozens of passengers left the ship without being tested.

A widespread outbreak is unlikely, but the official response has been “incompetent,” the science writer Kelsey Piper argued.

Even if there is only a one-in-100 chance that this leads to a pandemic, one-in-100 events happen, and if this is the response then we are “doomed to, eventually, get an unlucky roll.”