FirstFT: Trump pleads not guilty to 37 federal charges

Good morning. Donald Trump has pleaded not guilty to the first federal criminal charges brought against a former US president.

Trump was arraigned on a 37-count indictment tied to his handling of classified documents. He was arrested upon arrival at a Miami federal court before departing roughly two hours later.

The former president has accused prosecutors of conducting a “witch hunt” in bringing the case over his alleged failure to return sensitive national security records after leaving office. Jack Smith, the special counsel appointed by attorney-general Merrick Garland to oversee investigations into the former president, was present in the courtroom, according to US media reports.

The federal case is the second time Trump has been indicted in less than a year. In April he pleaded not guilty to 34 felony counts of falsifying business records in a case brought in a state court by the Manhattan district attorney.

The indictments have the potential to upend the 2024 presidential campaign, with Trump the clear favourite to win the Republican nomination, while also deepening divisions among Americans.

Here’s what else I’m keeping tabs on today:

• Monetary policy: The US Federal Reserve is expected to forgo an interest rate increase today after 10 consecutive rate rises since March 2022.

• Economic data: New Zealand’s first-quarter GDP figures are due. Some economists expect the data to show the economy contracting for a second straight quarter, putting it into recession. (Bloomberg)

• Partygate scandal: British MPs are set to publish a “damning” report on the conduct of former prime minister Boris Johnson.

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Five more top stories

1. China unexpectedly cut a key interest rate and announced tax breaks for businesses, amid signs that the post-Covid recovery in the world’s second-largest economy is losing steam. Analysts said the move probably signalled more substantial monetary easing and stimulus measures to come.

2. EY’s global chief executive Carmine Di Sibio has told partners he plans to retire next year, sparking a race to lead the accounting and consulting firm. Di Sibio’s future has been in doubt ever since the failure of his plan — codenamed Project Everest — to spin off EY’s consulting arm and list it on the stock market.

3. The annual pace of US inflation eased last month to its lowest level in more than two years. The consumer price index climbed 4 per cent year on year, but lingering price gains will keep pressure on the Federal Reserve to consider additional interest rate increases.

4. A four-week-old French start-up founded by a trio of former Meta and Google artificial intelligence researchers has raised €105mn in Europe’s largest-ever seed round. Mistral AI’s first round of financing values the Paris-based company at €240mn, highlighting the growing frenzy surrounding AI.

5. British distributor Bunzl is “de-risking” its supply chain by shifting some of its sourcing from China amid geopolitical concerns in the Asia-Pacific. Chief executive Frank van Zanten said that the company was diversifying its sourcing into countries including Mexico, India, Vietnam and Malaysia.

Deep dive

Nearly 1.4mn kilometres of metal-encased fibre criss-crosses the world’s oceans, speeding internet traffic seamlessly around the globe. But driven by fears of espionage and geopolitical tensions, the subsea cable market is in danger of dividing into eastern and western blocks, experts say. The FT explores how the US is pushing China out of the infrastructure underpinning the internet in this visual story.

We’re also reading . . . 

• Defence spending: Russia’s invasion of Ukraine has led to a sharp rise in military spending. Among the world’s five biggest spenders, the numbers are mind-boggling.

• Janan Ganesh: If you were a demagogue, would you choose to operate in Britain or America?

• China-South Korea relations: Beijing has pressured South Korea over closer ties with the US and Japan. But now, Seoul is pushing back.

Chart of the day

The dire situation on debt has become pressing, and substantial relief is needed, writes Martin Wolf. Much of that will have to come, in one way or the other, from China. Today, remarkably, bilateral debt owed by low-income countries to the high-income members of the Paris Club has become less than half that owed to non-Paris Club countries, mainly China.

Take a break from the news

Books about large regions or countries, be it Europe or China, often stay at the level of the macroscopic and analytical. But Ben Judah’s This Is Europe promises something different — “you want what politicians and pundits and political scientists can’t give you,” he writes in his preface. And Judah delivers on that promise, the FT’s Yuan Yang writes in this glowing review.

Additional contributions by Tee Zhuo and Gordon Smith