Evening Briefing: Europe

Ukrainian President Volodymyr Zelenskiy said Budapest wasn’t the best place for talks to end the war in his country but he told reporters in Kyiv today that he will attend if invited. He cited Hungarian Prime Minister Viktor Orban’s Russia-friendly stance as a difficulty.

“I do not believe that a prime minister who blocks Ukraine everywhere can do anything positive for Ukrainians or even provide a balanced contribution,” Zelenskiy said. Orban has repeatedly sought to stall European Union sanctions on Russia and traveled to Moscow to meet President Vladimir Putin.

US President Donald Trump announced plans to meet Putin in the Hungarian capital in the coming weeks following a phone call with the Russian leader last week.

EU foreign ministers meeting in Luxembourg today also were critical of the possible choice of venue. French Foreign Minister Jean-Noel Barrot said “the presence of Vladimir Putin on EU soil only makes sense if it allows for an immediate ceasefire without conditions.”

French President Emmanuel Macron said later that leaders of countries in the “Coalition of the Willing” would meet in London on Friday.

Meanwhile, it is understood US officials informed their European counterparts that they won’t, for now, be joining an initiative to expand the use of frozen Russian assets to support Ukraine. The US cited risks to market stability as the reason for its reluctance, people familiar told us. — Jennifer Duggan

What You Need to Know Today

French bonds declined after S&P Global Ratings downgraded the nation’s sovereign credit score. It was an unscheduled move that highlights the country’s fiscal woes and places its debt at risk of forced selling by some funds.

France’s politics and fiscal policies have been under scrutiny as Prime Minister Sebastien Lecornu is to push a budget through a divided National Assembly. Yields on French debt rose led by longer-dated tenors, with 10-year yields up three basis points to 3.39% compared to a one basis point move in their German counterparts. It means France has lost its double-A rating at two of the three major credit assessors in little more than a month.

Sebastien Lecornu Photographer: Benjamin Girette/Bloomberg

European Central Bank Executive Board member Isabel Schnabel reiterated that the international role of the euro should be enhanced. “For sovereignty, we need a strong currency, and this is our responsibility here at the ECB,” she said. “This is why we think it’s so important to foster the international role of the euro.” She referred to comments by ECB President Christine Lagarde saying that “this role needs to be earned — it doesn’t just fall from the sky.”

Amazon Web Services, the world’s largest cloud provider, said issues continue to plague its operations after a widespread outage. Amazon.com’s cloud service underpins a large chunk of the internet, accounting for about a third of the cloud market. The outage impacted a range of customers including government agencies, AI companies and financial platforms. Hours after saying that it had mostly recovered from the database network issue, AWS said some users were still struggling to connect.

Israel said it has resumed a truce with Hamas in Gaza after heavy fighting over the weekend. Both sides have accused each other of breaching the deal. US mediators Steve Witkoff and Jared Kushner had meetings today with Israeli officials aimed at solidifying the ceasefire. Israel launched strikes against Hamas in Gaza and suspended aid shipments yesterday after blaming the militant group for an ambush that killed two soldiers in the southern part of the strip. At least some aid supplies have now resumed, though the key border crossing of Rafah remains shut.

Chancellor Friedrich Merz doubled down on controversial comments he made last week suggesting Germany has too many migrants. “I have nothing to take back,” Merz today when asked about comments he made about how cities in Germany look and why the government needs to step up deportations.

The opposition Green Party as well as members of his Social Democratic coalition partner denounced the remarks as racist and discriminatory. Merz has been under intense pressure to respond to gains by the anti-immigrant Alternative for Germany, or AfD.

BNP Paribas plummeted after it was ordered to pay millions over claims it facilitated human rights abuses in Sudan. BNP has been fighting allegations for years that its decision to continue serving as Sudan’s banker in the 1990s and 2000s in the face of global condemnation enabled the then-regime to remain in place.

During that time civil war and ethnic cleansing campaigns lead to the abuse and death of hundreds of thousands of people. A jury in Manhattan federal court on Friday found the bank liable for the claims of three plaintiffs who said they were harmed when they lived in Sudan during that time. BNP Paribas fell as much as 10.6% as analysts said the decision could raise pressure to settle at a potentially higher cost than expected.

The EU is to propose stronger measures to curb emissions costs in a new and controversial carbon market as part of efforts to address concerns by consumers over rising energy costs. An emissions-trading scheme to cover buildings and road transport is due to kick in in 2027, but has been criticized by many member states over concerns that prices will rise sharply once it’s introduced. EU climate chief Wopke Hoekstra will announce the measures limiting those increases at a meeting of climate ministers tomorrow.