0615GMT//Putin will only talk to Zelensky in Moscow; Russian Orthodox Church parades through Moscow in show of strength
RUSSIAN MISSILES/DRONES HIT UKRAINE GOVERNMENT: A massive Russian missile and drone attack on Sunday morning hit Ukrainian government offices in the centre of Kyiv for the first time. Ukrainian officials said that this was an escalation of the war. Elsewhere in Kyiv at least four people were killed in the same missile strike, including a mother and her child.
PUTIN ONLY WANTS TALKS IN MOSCOW: Vladimir Putin said on Friday that he was only prepared to meet with Volodymyr Zelensky in Moscow for talks on how to end the war in Ukraine. He made the statement during a speech at the Eastern Economic Forum in Vladivostok. (COMMENT: This is bad news for any peace negotiations on Ukraine. Zelensky has said that he is not prepared to talk to Putin in Moscow.)
KADYROV WANTS ALL OF UKRAINE CAPTURED: Ramzan Kadyrov, the Kremlin-backed hardman leader of Chechnya, said that the war in Ukraine can only be stopped once the country becomes a Russian province. (COMMENT: Kadryov is a Kremlin-backed extremist, allowed to promote ideas that test even the most ardent nationalists' views. But there is always more than a grain of Kremlin thinking in these ideas, and they are worth noting.)
ORTHODOX CHURCH MARCH: Patriarch Kirill, the head of the Russian Orthodox Church, led a procession of an estimated 40,000 people along a 6km route through central Moscow on Sunday. Reports said that people from the surrounding regions were bused into Moscow to support the parade. (COMMENT: This was a display of public piety designed to place the Church and its "traditional values" at the centre of Russian society, a well-worn tactic by the Kremlin and its Orthodox Church allies to boost control of the population and differentiate Russia from what they see as the "decadent" West.)
BANKING PROBLEMS IN CHINA: Vladimir Putin has failed to persuade Xi Jinping, China's leader, to smooth blocked Russian payments through the Chinese banking system, Anton Berlin, the vice president of Norilsk Nickel, said at the Eastern Economic Forum. He said that Chinese banks are sensitive to the threat of secondary US sanctions and hold up payments for weeks while they study related texts and documents. (COMMENT: This is important as it highlights how dependent Russian companies have become on the Chinese banking system. It also shows just how frustrated Russian companies are with this reliance and the impact of sanctions.)
PANDA BONDS TO RETURN: Russian companies are in negotiations to issue debt in China for the first time since 2017, the FT has reported. It said that a first wave of yuan-denominated Panda bonds could be issued later this year, but only by Russian companies not under international sanctions. (COMMENT: If these "Russian Panda bonds" do launch, it would be a remarkable shift for Russian companies, again highlighting their reliance on the Chinese financial system.)
DISCOUNT STORES BOOMING: Discount stores in Russia are one of the only sections of the Russian consumer economy that is growing, economists said at the EEF in Vladivostok. They said that revenues at discount stores have risen by 27% this year – a sign that Russians were switching from mid and higher ranking stores. (COMMENT: This is a reflection on the state of the Russian economy. Russians are getting poorer and are looking for ways to save money.)
CAR SALES FALL: Anton Alikhanov, Russia's trade minister, admitted that new car sales were likely to be 30% lower this year than in 2024. He said that high interest rates were undermining the consumer market. (COMMENT: When Russian government officials start to admit that sales are falling, you know that the economy is under severe pressure.)
GOLD MINE EXPLOSION: An explosion at a gold mine in Siberia owned by billionaire Vladislav Sviblov killed at least three workers on Friday. The Mnogovershinnoye gold mine is a subsidiary of Highland Gold. Sviblov is the main shareholder in Highland Gold. (COMMENT: Kremlin critics have said that safety standards in Russia, already low before the war in Ukraine, have worsened further as businesses cut corners to boost production.)
ABRAMOVICH INVESTIGATION: The authorities in Jersey are investigating Russian billionaire Roman Abramovich for money laundering and tax evasion. Specifically, they want to investigate Abramovich's origins of wealth and his sale of the Sibneft oil company to the Russian government in 2005 for $13b and the transfer of assets in 2022 after he was placed under sanctions. (COMMENT: The criminal investigation into Abramovich is largely performative as it will not have a material impact on the billionaire. The former Chelsea FC owner now reportedly lives in Turkey. Jersey has already frozen assets worth $7b.)