Welcome to the Brussels Edition. I’m Suzanne Lynch, Bloomberg’s Brussels bureau chief, bringing you the latest from the EU each weekday. Make sure you’re signed up.

Does Europe have the stomach for a fight? That was the question posed by European Commission president Ursula von der Leyen this morning in a feisty speech to the European Parliament.

Setting out her vision for the EU, von der Leyen said that “this must be Europe’s independence moment,” pledging to frontload money for Ukraine and defending the EU-US trade deal struck over the summer as “the best possible deal” out there.

The speech couldn’t have been more timely. Overnight, Poland confirmed it shot down Russian drones that had entered its airspace — the most serious escalation between Russia and a NATO member since the full-scale invasion of Ukraine in February 2022.

The development has sparked alarm in Brussels. EU ambassadors are due to discuss the matter in a closed-door meeting this afternoon, while von der Leyen referenced the “reckless and unprecedented violation” in her speech, adding that Europe “stands in full solidarity with Poland.”

NATO Secretary General Mark Rutte said members of the alliance will defend “every inch” of its territory. He spoke after a meeting of the North Atlantic Council, NATO’s main decision-making body. 

Following the incident, Poland triggered NATO’s Article 4, a clause which sets off consultations on a potential response. Prime Minister Donald Tusk confirmed 19 airspace violations, with a “significant” number of drones originating from Belarus.

Poland’s Tusk in Warsaw last month. Photographer: Damian Lemanski/Bloomberg

Though this is not the first time Russian drones crossed into Polish airspace, it is the first time Poland has shot them down. The situation brought Poland the closest it has been to open conflict since World War Two, Tusk told a session of parliament in Warsaw earlier today.

As allies scramble to react to the escalation a key question is whether it was deliberate.

EU foreign policy chief and Russia hawk Kaja Kallas said the indications were that the violation was intentional. Rutte said that whether it was intentional or not, it was "absolutely reckless," adding that a full assessment is ongoing.

French President Emmanuel Macron, fresh from naming his new prime minister last night, said the incursion was “simply unacceptable,” and that he would speak to NATO’s Rutte. Attention is also turning to any response from Washington amid some signs from US President Donald Trump that he is losing patience with Russian leader Vladimir Putin.

The Latest

• France has its fifth prime minister in two years after Macron named Sebastien Lecornu as successor to François Bayrou.
• EU nations will discuss potential changes to imported carbon credits this month as they seek to lock-in a deal on the bloc’s landmark 2040 climate goal, Ewa Krukowska and John Ainger report.
• The EU was entitled to include gas and nuclear energy in its green rulebook, the bloc’s second highest tribunal ruled today in a blow to environmental activists.
• Europe’s largest bond-futures exchange is launching a contract for EU debt today, a move that could help boost trading liquidity and eventually lower the bloc’s borrowing costs.
• Slovakia has passed a €2.7 billion ($3.2 billion) package of spending cuts and tax increases for 2026 to avert further rating downgrades.
• A massive power outage that has affected tens of thousands of Berlin residents is continuing into its second day, with a full restoration not expected until tomorrow evening.

Seen and Heard on Bloomberg

Europe would be “well-prepared for a conflict” if it could increase production of 155mm artillery ammunition to around 3 million rounds per year from the current 2 million, Rheinmetall CEO Armin Papperger told Bloomberg’s Tom Mackenzie in an interview. Germany’s biggest defense contractor plans to deepen its existing collaboration with Lockheed Martin by producing US-designed ATACMS rockets at its plant in northern Germany in 15, 16 months, he said.

The Number 

That’s the number of jobs Novo Nordisk, the maker of Ozempic and Wegovy, will cut globally as it slashed its profit for the third time this year. The Danish company is fighting to recover ground lost to its rival, Lilly, in the booming obesity drug market.

Coming up

• European Council President Antonio Costa and German Chancellor Friedrich Merz hold a press conference in Berlin this evening
• EU Energy Commissioner Dan Joergensen meets US Energy Secretary Chris Wright tomorrow
• ECB governing council meeting in Frankfurt tomorrow

Final Thought

A major pension overhaul in the Netherlands is fueling a “mispricing” in German bonds that a top hedge fund says it’s looking to exploit. Barnegat Fund Management, the $621 million New Jersey-based investment firm, sees the cheapening in longer-maturity European bonds as overdone relative to the swaps investors use for hedging.

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