Cleaning house in Kyiv

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After a night marked by heavy Russian missile and drone attacks, Ukrainians awoke to learn that the state-security service was raiding premises of anti-graft officials, accusing them of cooperation with Moscow.

The head of a local office of the National Anti-Corruption Bureau was detained as part of the sweep, carried out without court orders, the bureau known as NABU said today.

The man was assisting his father in selling industrial hemp to Russia, and investigations are ongoing into whether he also traded secret information with Russian intelligence, according to the security service and the prosecutor general's office.

Both are institutions with a questionable reputation among Ukrainians, having been mired in corruption. That reality means that they'll need to have solid evidence for their actions, or risk raising concerns over Ukraine's commitment to rooting out graft under President Volodymyr Zelenskiy.

Zelenskiy and US President Donald Trump in Washington in February. Photographer: Andrew Harnik/Getty Images

Ukraine's government has made progress in fighting corruption since the pro-European protests of 2014 — under strong pressure from its donors, creditors and civil society.

Yet creating independent anti-corruption bodies has been challenging. NABU, for example, was set up a decade ago at the behest of donors to investigate graft among top officials. Its work has been supported by Kyiv's allies, but the bureau has faced attempts to weaken its position.

The US once took the lead in supporting the anti-graft fight, becoming a vocal critic when there were setbacks. President Donald Trump's administration has shown considerably less interest in resuming that role.

The latest raids, which follow state accusations of evading military service leveled at an anti-corruption activist earlier this month, are either evidence of a crackdown on graft, or a sign that those fighting against it are themselves now suspect.

At a time when international partners are working to maintain support for Ukraine financially and militarily, the onus lies with Kyiv to clean its house. — Daryna Krasnolutska

Zelenskiy during a news conference at the Ukraine Recovery Conference in Rome this month. Photographer: Alessia Pierdomenico/Bloomberg

Global Must Reads

Japan's Shigeru Ishiba sought to buy time for his premiership after his coalition lost its majority in an upper-house election yesterday, leaving him in a weaker position to stave off opposition demands for tax cuts or secure a last-minute trade deal with the US. It's the first time a Liberal Democratic Party leader will govern Japan without a majority in at least one of the chambers since the party was founded in 1955, a blow that came as simmering discontent over a cost-of-living crunch benefited smaller populist, anti-foreigner parties.

Ishiba at party headquarters today. Photographer: Toru Hanai/Bloomberg

European Union trade envoys are set to meet as early as this week to prepare for a possible no-deal scenario with Trump, whose tariff-negotiating position is seen to have stiffened ahead of an Aug. 1 deadline. Meanwhile, the latest round of European sanctions has hit a number of companies and banks in China, prompting Beijing to protest and promise a response that would safeguard and protect its own firms.

The US president's tariff threat against Brazil over a legal probe into his political ally, Jair Bolsonaro, caught the Supreme Court in Brasilia off guard, according to Daniel Carvalho's inside-the-room account of events. Read how Brazilian judges may have underestimated the White House, and how Trump, too, miscalculated.

India's opposition is preparing to confront Prime Minister Narendra Modi's government over the controversial revision of electoral rolls in the eastern state of Bihar, months before a crucial election in the region. Opposition parties and activists have taken to the streets and courts, warning that the overhaul could disenfranchise more than 30 million voters, many from already marginalized communities.

Israel warned it would move for the first time into a town in the heart of the Gaza Strip that it had earlier skirted for fear of harming hostages, after it accused Hamas of stalling at US-brokered ceasefire talks. The Israeli Defense Forces told Palestinians in parts of Deir al-Balah to immediately evacuate southward as the war's toll on civilians spiraled.

China has prevented an American citizen who works for the US Commerce Department from leaving the nation for several months, according to media reports — an episode that coincides with Beijing and Washington trying to arrange a summit where they can address their differences on trade ties.

Iran reached an agreement in principle to hold talks with the UK, France and Germany over its nuclear program, which have stalled since June 13 when Israel launched an attack on the Islamic Republic.

Thailand accused Cambodia of injuring its soldiers with land mines planted on the Thai side of their shared border, prompting Phnom Penh to reject the claim and suggest the incident may have been aimed at triggering a larger confrontation.

Greece will establish two national marine parks in what it says is an effort to protect ocean wildlife, a move that could strain ties with neighboring Turkey.

On the latest episode of the Trumponomics podcast, we discuss whether the US administration's race to loosen regulations is setting the stage for another financial crisis. Listen on Apple, Spotify, or wherever you get your podcasts.

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Chart of the Day

As markets worldwide shuddered on news that Trump was likely to fire Jerome Powell, James van Geelen at Citrini Research recommended his 50,000-odd clients buy two-year Treasuries and sell US 10-year notes. The theory is that a new Fed chair would be more likely to fall in line with Trump's lobbying for lower interest rates, and that would push down short-term yields. Like many on Wall Street and beyond, van Geelen is taking the once-unthinkable threat seriously — and that means protecting against it.

And Finally

The massive economic stimulus and boost to clean power from a 1.2 trillion-yuan ($167 billion) mega-dam in Tibet has proven alluring enough for Chinese leaders to set aside concerns about potential damage to biodiversity and the impact on relations with India. Premier Li Qiang launched construction of the hydropower project, which is three times the size of the Three Gorges Dam, on the lower reaches of the Yarlung Tsangpo river on Saturday.

A section of the Yarlung Tsangpo river. Photographer: Li Lin/China News Service/VCG/Getty Images

Thanks to the 36 people who answered Friday's quiz and congratulations to Beverly Larson, who was the first to correctly name France as the nation where the government proposed dropping two national holidays as part of an effort to repair public finances.