Ukraine turns tables on Putin

Russia’s invasion sparks Ukranian counter intervention [View in browser]( [Bloomberg]( Welcome to Balance of Power, bringing you the latest in global politics. If you haven’t yet, sign up [here](. President Vladimir Putin’s invasion of Ukraine has unexpectedly given rise to a Ukrainian intervention across the border into Russia, to the evident embarrassment of the Kremlin leader. The incursion by [as many as 1,000 Ukrainian troops]( into the Kursk region that’s now in its third day caught out the Russian military. It’s the first time since World War II that another country’s army has invaded Russia. A grim-faced Putin summoned his army and security-service chiefs for an explanation yesterday. Furious Russian military bloggers accused top officials of staggering incompetence. European gas prices rose amid reports of [fighting near a key Russian station]( on the last remaining pipeline route to Europe via Ukraine. So far, gas continues to flow. Ukraine has said nothing about the mission or its goals. Theories abound, from an attempt to seize territory as a potential bargaining chip in future negotiations with Moscow, to a diversionary tactic to ease pressure on stretched defenses in Ukraine by drawing Russian forces away from the frontline. The White House said it would seek a “better understanding” from Kyiv, adding that Ukraine hasn’t breached US rules on its use of American-supplied weapons inside Russia. The episode exposed the fragility of Russian border defenses with [growing numbers of its soldiers]( fighting in Ukraine. It has boosted Ukrainian morale. And it has also punctured the Kremlin’s carefully constructed image of Putin as the protector of ordinary Russians. Instead, the war he started in Ukraine now spills increasingly into Russia, where people in border regions live under constant risk of shelling and drones strike key industrial facilities. For Ukraine, it’s likely to bolster Kyiv’s argument that US and European allies shouldn’t fear Kremlin threats of escalation and that it should be allowed to take the fight to Putin in any way it sees fit to hasten an end to the war.— [Anthony Halpin]( Damaged buildings in the Kursk region on Tuesday. Source: Acting Kursk Governor Alexey Smirnov Global Must Reads Enthusiastic crowds greeted Kamala Harris and her running mate, Minnesota Governor Tim Walz, as they [took their election campaign]( to the crucial Midwest swing states of Wisconsin and Michigan. JD Vance also visited the two states, as he seeks to shore up his standing after [a rocky start]( as Donald Trump’s vice presidential pick. The UK experienced some relief from the worst outbreak of rioting in more than a decade after thousands of anti-racism protesters turned out to counter far-right demonstrations that failed to materialize yesterday. Instead of more brick-throwing, police officers under attack and attempted arson, large crowds expressed [their rejection of the violence]( looting and destruction of recent days. Anti-racism protesters in London. Photographer: Carl Court/Getty Images Iranian President Masoud Pezeshkian told his French counterpart, Emmanuel Macron, that the US and Europe must urge Israel to [accept a cease-fire in Gaza]( to reduce tensions in the Middle East. His comments on a call yesterday hint at a diplomatic path to de-escalation as Israel braces for retaliation after the killing of a top Hamas leader in Tehran. Nobel Prize-winning economist Muhammad Yunus arrived in Bangladesh today ahead of the swearing in of an interim government that he will lead after student-led protests forced Prime Minister Sheikh Hasina to flee the country. At the airport in the capital, Dhaka, [he shook hands]( with military chiefs and members of civil society. Kenyan President William Ruto appointed 19 ministers including members of the opposition in the face of threats of [new anti-government demonstrations](. The protests over plans to impose levies on everything from bread to diapers erupted in the East African nation in mid-June and have led to the deaths of at least 61 people. Members of Thailand’s biggest opposition party pledged to [form a new group]( to challenge the conservative establishment’s grip on power, setting the stage for more political turmoil in Southeast Asia’s second-largest economy. Chilean President Gabriel Boric accused Nicolás Maduro of trying to steal Venezuela’s election and said his administration is violating human rights, [ratcheting up global criticism]( of last month’s contested vote. Former Catalan President Carles Puigdemont appeared at a rally in Barcelona today [despite a Spanish arrest warrant]( against him for embezzlement of public funds. Washington Dispatch Walz is likely the [least wealthy of the four people]( on this year’s major-party presidential tickets, with a disclosed net worth of under $1 million. As a former House lawmaker who pushed a federal law tightening disclosures of congressional stock trading in 2012, Walz said at the time he did not own any stocks himself. More than a decade later, he still doesn’t, according to his most recent disclosures. Trump is worth $5.7 billion, ranking 500th on the Bloomberg Billionaires Index, while Vance disclosed a net worth between $4.3 million and $10.7 million in his most recent Senate disclosure. Harris has disclosed between $550,000 and $1.1 million in cash in US bank accounts. She also holds between $775,000 and $1.8 million in retirement funds. One thing to watch today: Data from the Department of Labor are expected to show initial applications for unemployment benefit declined in the week ending Aug. 3. [Sign up for the Washington Edition newsletter]( for more from the US capital and watch Balance of Power at 1 and 5 p.m. ET weekdays on Bloomberg Television. Chart of the Day With US interest rates at the highest level in more than two decades and signs of a cooling economy, businesses scarred by pandemic-era worker shortages have largely eschewed layoffs. But [recent data is stoking fears]( employers may soon pick up the pace of job cuts. And Finally Pop superstar Taylor Swift’s shows planned for this week in Vienna as part of her Eras Tour were canceled after Austrian police arrested two people on suspicion of planning a terrorist attack at the Ernst Happel Stadium. Officials [found chemical substances]( at the home of a 19-year-old and later detained another person. The teenager, who was not named, had been radicalized by Islamic State and had singled out Swift’s concerts as a potential target, Director General for Public Security Franz Ruf said. 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