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Good morning and welcome back to FirstFT Asia. We start today with the latest news on the Middle East war, after Iran attacked a US air base in Qatar in response to American air strikes on its nuclear sites. Also on the agenda:
Japan’s ruling party loses big in Tokyo vote
The ‘Kirklandisation’ of Big Law
Life as the world’s 150th-ranked tennis player
Donald Trump has thanked Iran for giving the US advance notice of a barrage of missiles against the biggest American air base in the Middle East and said he would also encourage Israel to make peace. Here’s what to know.
What Trump said: The US president described the Iranian attack on the Al Udeid base in Qatar as “very weak”, stating that of 14 missiles fired, 13 were intercepted and one allowed to complete its path without causing harm. “CONGRATULATIONS WORLD, IT’S TIME FOR PEACE!” Trump wrote on his Truth Social network yesterday, adding that the Iranians had “gotten it all out of their ‘system,’ and there will, hopefully, be no further HATE”.
A chance to de-escalate? Oil prices fell as traders calculated that the attack was largely symbolic, and could signal an effort by Iran to avoid a full-blown conflict, despite the risk that it could trigger a robust response. Israel’s defence minister Israel Katz said the military would continue striking Iran as long as the Islamic republic kept firing at Israel. But two people familiar with the Israeli government’s thinking said that given the damage it had already done to Iran’s ballistic missile and nuclear capabilities, it was looking for ways to wind up the conflict.
Follow our live blog for the latest updates — and here’s more coverage of the conflict:
Where is Iran’s uranium?: US and Israeli attacks have hit key nuclear sites but the search continues for Iran’s 400kg stockpile of enriched material.
The hunt for Mossad agents: Iranian paramilitaries have joined police and security forces nationwide to combat what Tehran claims is a vast espionage network built by the Israeli spy agency.
Opinion: Turning Trump’s strikes on Iran into an actual success will depend on getting the momentous decisions of the next few days right, writes Philip Gordon
Here’s what else we’re keeping tabs on today:
Economic data: Malaysia releases May CPI inflation data and Taiwan reports industrial output for the month.
Nato summit: Leaders from member states meet in The Hague for a summit aimed at placating Trump over defence spending. The gathering is already at risk of descending into acrimony.
China: The NPC Standing Committee, China’s senior legislative body, convenes for its 16th session, running until Friday.
Five more top stories
1. Japan’s ruling party has suffered its worst result in local assembly elections in Tokyo, as residents of the capital used the vote to protest against soaring food prices and low wage growth. The results of Sunday’s poll underscored the challenge Prime Minister Shigeru Ishiba could face next month in elections for the upper house of Japan’s national parliament.
2. Federal Reserve vice-chair for financial supervision Michelle Bowman has called for an interest rate cut as soon as July, saying Trump’s trade war would have a smaller effect on inflation than some economists fear. Bowman’s remarks highlight a divide between central bank officials over how they should respond to the US president’s tariffs.
3. UK officials are lobbying South Korea to switch to Rolls-Royce as the main engine partner on Seoul’s fighter jet programme. South Korean defence group Hanwha Aerospace currently partners with Rolls-Royce’s American rival GE Aerospace to produce current-generation engines on the KF-21 fighter jet. But US export restrictions over national security concerns have frustrated Seoul’s ambitions to sell the jet.
4. Germany will bring back conscription to boost its armed forces if a plan to use volunteers fails to deliver enough recruits, the country’s defence minister has said. Boris Pistorius said he would begin with a voluntary model to attract young people, supporting the Bundeswehr’s goal of more than doubling its reserve forces in response to Vladimir Putin’s invasion of Ukraine.
5. Revolut’s chief executive is in line for a multibillion-dollar windfall if he more than triples the company’s current valuation to about $150bn. People familiar with the matter say Nik Storonsky, who founded the fintech in 2015, would see his stake increase significantly under a long-standing Elon Musk-style pay deal.
News in-depth
Decades ago, long before it was a private-equity powerhouse, the law firm Kirkland & Ellis was a pioneer of a model that overturned a long-standing norm in the legal industry. The Chicago-founded firm promoted lawyers to partner without giving them an ownership stake in the business. The model has been widely copied across the industry in a sign of how comprehensively the rise of Kirkland and its moneymaking machine has roiled the world of Big Law.
We’re also reading . . .
Chart of the day
China faces a currency trilemma. Should its policy be for the renminbi to strengthen, depreciate or stabilise? Gerard Lyons, an economist who sits on the board of the Bank of China (UK), argues appreciation would suit Beijing’s global ambitions for the currency.
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Take a break from the news
The winners of Wimbledon this year will walk away with £3mn each. But what about players lower down the pecking order? Japanese player Taro Daniel, who is hovering around the 150 mark, discusses the highs and lows of life on the tour — and how being a tennis pro is like running a small company.
