European Midday Briefing : Mood Hit by Rate Hike -2-

Under its Brexit divorce deal, Britain agreed to place a customs border within its own country to avoid creating a hard border between Ireland, an EU member, and the British province of Northern Ireland. Both sides feared doing so would inflame sectarian tensions in the region between unionists, who favor continued British rule, and republicans, who want political union with the rest of Ireland.

Janet Yellen Visits Ukraine to Discuss Economic Support

KYIV, Ukraine-Treasury Secretary Janet Yellen visited Kyiv on Monday, the latest high-profile trip aimed at sending a message of American commitment to supporting the country's defense against Russia's invasion, including with financial aid.

Ms. Yellen's presence in Kyiv, a rare trip to a war zone by a U.S. Treasury secretary, came a week after President Biden's surprise visit a week ago, and three days after Ukrainians commemorated the first anniversary of Russia's full-scale assault on their country.

Russia Launches New Wave of Iranian-Made Drones Against Ukraine

KYIV, Ukraine-Russia launched a new wave of Iranian-made drones against Ukrainian cities, breaking a weekslong lull in such attacks, as its forces continued to tighten their grip around the embattled eastern city of Bakhmut.

Ukraine's military said it shot down 11 out of 14 Iranian-made Shahed drones late Sunday and early Monday, including all nine that were aimed at the capital city of Kyiv. The remaining three drones, however, hit targets in the central city of Khmelnytskyi, with explosions there killing two rescue workers and injuring three other people, according to the local government. Russia also fired S-300 missiles at the southern city of Zaporizhzhia overnight, hitting an infrastructure site but causing no casualties, the local government said.

U.S. Aims to Pull Ex-Soviet Republics From Russian, Chinese Orbits

ASTANA, Kazakhstan-The Biden administration is wooing former Soviet republics in Central Asia, expanding its efforts to prevent Russia from circumventing Western sanctions while providing an opportunity for those countries to ease their reliance on Moscow.

Antony Blinken will make his first visit to the region as secretary of state on Tuesday with stops in Kazakhstan and Uzbekistan. He will meet officials from Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan, a bloc that together with the U.S. is known as the C5+1.

Nigeria Election Criticized by International Observers, Opposition Parties

LAGOS, Nigeria-Early results from Nigeria's presidential election showed a sizable lead for the ruling party's Bola Tinubu on Monday, as international observers said serious logistical problems, violence and the slow publishing of polling-station results had marred the vote in Africa's largest economy and most-populous nation.

By early Monday evening, results sheets from just over one-third of Nigeria's 176,846 polling stations had been loaded onto the website of the country's electoral commission following Saturday's vote. The commission, which had previously vaunted the immediate publication of those results as a key step toward improving election transparency, said the delays were due to technical glitches and didn't affect the integrity of the vote.

GLOBAL NEWS

Russia Turns to China's Yuan in Effort to Ditch the Dollar

Russia's economy, restricted from Western financial networks and the U.S. dollar, has embraced a burgeoning alternative: the Chinese yuan.

Energy exporters are increasingly getting paid in yuan. Russia's sovereign-wealth fund, a war chest to support government spending burdened by battlefield costs in Ukraine, is using the Chinese currency to store its oil riches. Russian companies have borrowed in yuan, also known as renminbi, and households are stashing savings in it.

U.S. Wants Allies to Squeeze China on Chips. Progress Is Slow.

Call it the battle for ASML.

Last October, the Biden administration launched a microchip cold war against China, slapping export controls on the most advanced semiconductors. That effort gets high marks from both national security and market types. "I never thought the U.S. would have the gumption to defend this gem of an industry," says C.J. Muse, semiconductor analyst at Evercore ISI. "I applaud it."

Pentagon to Reap Rewards From $53 Billion Chips Act

WASHINGTON-The Pentagon will have secure access to leading-edge semiconductors manufactured at facilities receiving funding from the $53 billion Chips Act, Commerce Secretary Gina Raimondo said, ensuring the industry can supply the military with the advanced chips it needs for modern weapons systems.

The increased involvement of the military and national security officials comes as intensifying rivalry with China and weaknesses in the supply chain exposed during the pandemic raise concerns among policy makers that the U.S. has become too reliant on imported chips.

Move Over EVs, Hybrids Are Hot in China

Don't write off hybrid electric vehicles.

After Tesla, the most highly valued U.S.-listed EV company isn't homegrown Rivian or Lucid but Li Auto, a Chinese manufacturer that went public in 2020 by listing American depositary receipts. It has a market value of roughly $26 billion, compared with $20 billion for NIO, which took the Chinese ADR route earlier, $17 billion for Rivian and $15 billion for Lucid.

White House Says No Consensus on Covid Origin

The White House said there is no consensus within the Biden administration over the origins of the Covid-19 virus, a day after the disclosure of an Energy Department assessment that the pandemic most likely originated with a leak from a Chinese lab.

The Energy Department, which had previously been undecided on the origins of the pandemic, recently joined the Federal Bureau of Investigation in saying the virus likely spread via a mishap at a Chinese laboratory, The Wall Street Journal reported Sunday.

U.S.-Israeli Dual National Killed by Palestinian Gunmen in West Bank Attack

TEL AVIV-A U.S.-Israeli dual national was killed Monday in what Israeli authorities said was a terrorist attack by Palestinian gunmen in the West Bank, the latest incident in an extended wave of deadly violence.

Israel's military said that Palestinian gunmen arrived in a vehicle at a junction near the city of Jericho, fired at an Israeli vehicle and fatally injured the victim, whose name hasn't been released. They then drove on and fired at two more Israeli vehicles without injuring anyone else, before setting their vehicle alight and fleeing from Israeli forces.

Russia Launches New Wave of Iranian-Made Drones Against Ukraine

KYIV, Ukraine-Russia launched a new wave of Iranian-made drones against Ukrainian cities, breaking a weekslong lull in such attacks, as its forces continued to tighten their grip around the embattled eastern city of Bakhmut.

Ukraine's military said it shot down 11 out of 14 Iranian-made Shahed drones late Sunday and early Monday, including all nine that were aimed at the capital city of Kyiv. The remaining three drones, however, hit targets in the central city of Khmelnytskyi, with explosions there killing two rescue workers and injuring three other people, according to the local government. Russia also fired S-300 missiles at the southern city of Zaporizhzhia overnight, hitting an infrastructure site but causing no casualties, the local government said.

Hong Kong Lifts Citywide Mask Mandate After Almost Three Years

HONG KONG-After almost three years, Hong Kong said it will scrap its mask mandate starting March 1, removing one of the longest-running pandemic restrictions worldwide as the city tries to rebuild its image as an international financial center.

The city's Chief Executive, John Lee, announced the move Tuesday, lifting a ban that had been criticized by some health experts for requiring people to wear masks in public places at all times, except during exercise and in country parks, even as most other Covid-19 restrictions had been gradually dismantled in recent months.

Watchdog Report on Afghan Collapse Points to Abrupt Withdrawal, Lack of Planning

A government watchdog said an abrupt, uncoordinated withdrawal from Afghanistan and years of problems with planning and oversight of U.S. assistance contributed to the collapse of the Western-backed government in Kabul and the Taliban takeover of the country soon after American forces departed, according to a report released Monday.

Poor accountability on weapons and equipment provided to Afghanistan and a lack of systemic planning were also important factors in the military collapse there, according to the report by the Special Inspector General for Afghanistan Reconstruction. The document, which was reported earlier by The Wall Street Journal, also calls out the Department of Defense for delaying answering official inquiries, missing deadlines and providing incomplete answers to questions.

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This article is a text version of a Wall Street Journal newsletter published earlier today.

(END) Dow Jones Newswires

02-28-23 0614ET