The risks to Putin

Vladimir Putin is preparing to secure a fifth term in elections next year [View in browser]( [Bloomberg]( Scarcely two months ago, the world watched in shock as a Russia’s Wagner mercenaries rolled their tanks toward Moscow. Bogged down in Ukraine, facing sanctions abroad and mutiny at home, Vladimir Putin had never looked more vulnerable. Now, with Wagner chief Yevgeny Prigozhin distanced and the president’s powers bolstered by parliament, Putin’s preparing to secure a fifth term in March 2024 elections. Key Reading: [Putin Turns to Ruble and Ballot to Shore Up Shaken Authority]( [Russia’s Powerful Split Into Squabbling Factions Over the Ruble]( [Russia’s Moon Failure a Dent to Its Space Partnership With China]( Follow our [Ukraine Recap]( for the lastest on the Russian invasion. Though he’s set to win unchallenged, the Kremlin sees the ballot as an opportunity to draw a line under the failed rebellion and show Putin is both in control and has support for Europe’s biggest conflict since World War II. In preparation, Kremlin aides launched rare criticism against the central bank and demanded it stop living standards from eroding further, prompting an emergency interest-rate hike last week to defend the ruble. Despite international sanctions, the economy is proving resilient: It’s growing after a year of contraction. Economists predict it will be back at pre-war levels as soon as next year. That’s partly driven by military spending, but Putin has extended social benefits to Russia’s most vulnerable, who are also his core voters. While Putin’s personal approval rating was 82% in July, he’s not unassailable. The political and business elite is sticking with him, for now, but his handling of the mutiny tarnished his strongman image. Discontent with how the top military leaders are managing the war is also simmering. Casualties are mounting, and the conflict is creeping closer to home, with Ukraine stepping up drone attacks on Russian soil. Kyiv’s NATO allies are also providing more advanced weaponry, including F-16 fighter jets, that they’d earlier balked at sending. That presents a risk for Putin as the invasion heads into its 19th month. — [Lin Noueihed]( A damaged office following a drone strike in Moscow on July 30. Photographer: Alexander Nemenov/AFP/Getty Images Check out the Bloomberg Politics [webpage](, and if you are enjoying this newsletter, sign up [here](. Global Headlines President Xi Jinping’s drive to shift China away from the debt-fueled growth model of his predecessors is facing its [toughest test yet](. The $18 trillion economy is decelerating, consumers are downbeat, exports are struggling, prices are falling and more than one in five young people are out of work. - Chinese banks kept a key interest rate that guides mortgages on hold, a [surprise move]( that sowed confusion over the country’s approach to stemming its property slump. Former US President Donald Trump is planning to skip primary debates against other Republican candidates after opinion polls showed him leading the field by what he described as [“legendary” numbers](. His announcement on his Truth Social platform signals he’s already focusing on a possible matchup against President Joe Biden in the presidential election next year. Challenging the global order dominated by wealthy nations is the main order of business when the BRICS bloc meets this week in Johannesburg. Brazil, Russia, India, China and South Africa will use their summit to begin the process of enlisting more members to [bolster its global heft]( and discuss how to accelerate a shift away from the US dollar as the standard reserve currency. Best of Bloomberg Opinion - [The BRICS Are Neither Anti-West Nor a Bloc: Andreas Kluth]( - [2024 Won’t Be the End of South Africa’s ANC: Melanie Verwoerd]( - [Alas, Trump Is Still Eligible to Run for Office: Noah Feldman]( Anti-graft campaigner Bernardo Arévalo won Guatemala’s presidential election [by a landslide]( after pledging to weed out the “systemic corruption” that he said keeps the Central American nation poor. Arévalo, a 64-year-old sociologist and former diplomat, stayed in the race through repeated attempts to disqualify his party. His rival, former first lady Sandra Torres, hasn’t yet conceded defeat. Arevalo and his running mate Karin Herrera at a press conference in Guatemala City yesterday. Photographer: Luis Echeverria/Bloomberg Explainers You Can Use - [Tracking the Twists and Turns of the US-Iran Conflict]( - [What to Know About New Covid Strains Gaining Ground]( - [Tracking Tropical Storm Hilary’s Latest Path]( Former property tycoon and political newcomer Srettha Thavisin is aiming to become Thailand’s next prime minister in a vote scheduled tomorrow that may help resolve a [months-long political impasse](. While backed by a coalition of populist and conservative parties, Srettha’s fate rests on the military-appointed Senate. Tune in to Bloomberg TV’s Balance of Power at 5pm to 6pm ET weekdays with Washington correspondents [Annmarie Hordern]( and [Joe Mathieu](. You can watch and listen on Bloomberg channels and online [here](. News to Note - North Korean leader Kim Jong Un oversaw [the test launch]( of a strategic cruise missile from a naval vessel, the country’s official news agency reported, as South Korea and the US are set to begin annual military exercises. - China is [intensifying a crackdown]( on alleged spies for the US, saying it found another case of an individual passing information to the Central Intelligence Agency, adding to a series of espionage accusations between the two nations. - UK Foreign Secretary James Cleverly is [set to visit China]( in the last week of August for talks focused on Russia and Ukraine, sources say. - Ecuador’s presidential race will be decided in [an October runoff]( between Socialist candidate Luisa Gonzalez and entrepreneur Daniel Noboa. - Biden aims to show the US government is backing the residents of Maui when he [visits the fire-stricken island]( today amid criticism of his response to the historic disaster. Thanks to the 34 people who answered our Friday quiz and congratulations to Tiago Neves, who was first to name the UK as the country whose prime minister is planning a meeting this year that for the first time would gather world leaders and artificial intelligence executives. And finally ... The World Bank’s decision to halt new loans to Uganda after the introduction of severe anti-LGBTQ laws that introduce life imprisonment and even the death penalty for certain acts is raising concerns over the lender’s [possible inconsistent approach](. About 60 nations criminalize same-sex consensual sexual acts, but a source said Uganda became a target because its laws are much stricter than any other nation’s. A Gay Pride parade in Uganda in 2015. Photographer: Isaac Kasamani/AFP/Getty Images More from Bloomberg - [Washington Edition]( for exclusive coverage on how the worlds of money and politics intersect in the US capital - [Economics Daily]( for what the changing landscape means for policy makers, investors and you - [Supply Lines]( for daily insights into supply chains and globe trade - [Bw Daily]( for unique perspectives, original reporting and insightful analysis from Businessweek’s renowned journalists - [Green Daily]( for the latest in climate news, zero-emission tech and green finance Explore more newsletters at [Bloomberg.com](. Follow Us Like getting this newsletter? [Subscribe to Bloomberg.com]( for unlimited access to trusted, data-driven journalism and subscriber-only insights. Want to sponsor this newsletter? [Get in touch here](. You received this message because you are subscribed to Bloomberg's Balance of Power newsletter. 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