US lawmakers under pressure to approve military aid for Israel, Tianqi Lithium at risk in Chile, big US banks face depositor pressure. Israel debates response to Iran's attack, China's lithium investment in Chile. Analysis of net interest income impact on banks.
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Quick takeaways
Israel considers response to Iran's unprecedented attack, seeking support from key allies.
Tianchi Lithium faces risks in Chile due to changes in government control of resources.
Deep dives
Israel's Response to Iran's Attack
Israel is deliberating on how to react to Iran's unprecedented strike, involving hundreds of drones and missiles. The attack was in retaliation for a suspected Israeli strike on Iran's consulate in Syria, marking the first direct Iranian attack on Israel. Discussions are ongoing with key partners, including the US, which urges restraint and intends to assist Israel in self-defense. Pressure mounts on US lawmakers to provide additional military aid to Israel amidst fears of a potential regional conflict.
Challenges Faced by US Big Banks
Major US banks like JPMorgan Chase, Wells Fargo, and Citigroup have profited from higher interest rates through net interest income but are now facing uncertainties. Net interest income, the profit from the difference between what banks earn from loans and investments versus what they pay depositors, is under pressure due to changing market dynamics. Banks warn that the future holds challenges as they may need to offer higher savings rates to depositors, impacting their profit margins.
Tianchi Lithium's Investment in Chile
China's Tianchi lithium made a significant investment in Chile's SQM, a major lithium producer, to secure access to lithium reserves for electric vehicles. However, geopolitical changes, including Chile's move to renegotiate state involvement in resources, have jeopardized Tianchi's stake and decision-making power in SQM's crucial lithium assets. Tianchi faces the risk of diluted ownership and limited influence, highlighting the caution needed in strategic investments in resources amidst evolving geopolitical landscapes.
US lawmakers face new pressure to approve military aid for Israel, and Tianqi Lithium’s strategy is at risk as Chilean President Gabriel Boric’s government works to take back control of resources. Plus, depositors put pressure on big US banks.
The FT News Briefing is produced by Fiona Symon, Sonja Hutson, Kasia Broussalian and Marc Filippino. Additional help by Josh Gabert-Doyon, Denise Guerra, Sam Giovinco, Peter Barber, Michael Lello, David da Silva and Gavin Kallmann. Our engineer is Monica Lopez. Topher Forhecz is the FT’s executive producer. The FT’s global head of audio is Cheryl Brumley. The show’s theme song is by Metaphor Music.