Welcome to the Brussels Edition, Bloomberg’s daily briefing on what matters most in the heart of the European Union. We’re keen to hear your views on this newsletter. Please participate in our short survey.

EU leaders Ursula von der Leyen and Antonio Costa are in Beijing today for the signing of a landmark climate cooperation document with Chinese President Xi Jinping. Von der Leyen told Xi that relations were at “an inflection point.” But the historic moment is at risk of being overshadowed by rapidly evolving EU-US trade talks. Brussels and Washington are progressing toward an agreement that would set a 15% tariff for most imports, according to diplomats briefed on the negotiations, though the EU is still pushing for cars to be included in that rate. Steel and aluminum imports above a certain quota potentially face a higher tariff of 50%. White House trade adviser Peter Navarro sounded a word of caution about the prospect of a deal. “Never, never assume that anything's fixed until the boss says it's fixed,” he told Bloomberg in an interview yesterday.

— Lyubov Pronina

What’s Happening

On Hold | The ECB is set to leave interest rates steady for the first time in more than a year as it awaits clarity on how US President Donald Trump’s tariffs will affect inflation. Most economists surveyed by Bloomberg still expect another quarter-point reduction in September. 

Broadcom Scrutiny | Broadcom’s $61 billion acquisition of VMware faces scrutiny from EU judges, after an Amazon-backed cloud computing group contested the bloc’s approval of one of the world’s biggest tech deals. 

Climate Litigation | The International Court of Justice delivered a historic advisory opinion, saying countries had to do all they can to combat rising temperatures. Failure to do so could entail consequences -- like paying reparations to the most-affected countries -- something the EU, as a historically big CO2 emitter, has long rejected.

Bank Bust | UBS Group lost an attempt to fully overturn an EU antitrust fine over Credit Suisse's involvement in a sweeping foreign-exchange price fixing cartel — but the legal defeat was sweetened after judges slashed the fine by nearly two-thirds.

Nazi Accounts | Meanwhile UBS as the new owner of Credit Suisse is in the spotlight as part of efforts to look into new evidence on the mishandling of Holocaust victims’ money, along with funds looted by the Nazis. Read our story on a crusade by Ronald Lauder, the billionaire president of the World Jewish Congress, seeking compensation.

Around Europe

Kyiv Protests | Protests flared across Ukraine for the second night after President Volodymyr Zelenskiy’s decision to hobble anti-corruption authorities. The move blindsided Kyiv’s allies and may have inflicted lasting damage to its ambition to join the EU. 

Polish Reshuffle  | Poland will create a superministry for the finance and economy portfolios as part of a wider cabinet reshuffle as Prime Minister Donald Tusk seeks to revamp his coalition government. The new ministry is meant to be a one-stop shop for domestic and foreign companies to fuel investment and growth.

Defense Push | Germany has approved a law to accelerate military planning and procurement, as it looks to transform its military into Europe’s strongest conventional army. It also includes changes related to air-defense radar systems and military airfields.

Football Funding | Fortitude Capital’s Antonio Esteves plans to invest in football stadiums in Portugal as clubs join a trend in Europe of revamping homegrounds to boost revenue. The Lisbon-based private equity firm has raised almost €500 million to finance stadium upgrades for Benfica, FC Porto and Sporting CP.

Fighting Drought | Greece plans to merge more than 700 mostly municipal-controlled water companies into just three to tackle a worsening drought that’s left reservoirs supplying Athens at the lowest level in three decades, we’ve learned. The government will also create a fund to finance dams, desalination plants and other investments to safeguard water security.

Chart of the Day

The Dutch government is confident the country will secure enough natural gas inventories ahead of this winter and plans to establish an “emergency reserve” starting in 2026 to ease trader concerns over sluggish storage injections. Traders have been watching Dutch reserves as they’ve been lagging behind peers such as France, Italy and Austria. The country is a relatively small energy consumer, but it’s a key trading hub, home to the continent’s gas benchmark. 

Today’s Agenda

All times CET

• 4:40 a.m. Jens Eskelund, head of EU Chamber of Commerce in China speaks to Bloomberg TV
• 7 a.m. European Commission President von der Leyen and European Council President Costa meet President Xi, 1 p.m. meet Premier Li Qiang, 2 p.m. speak at press conference 
• ECB rate-setting meeting in Frankfurt
• Ireland Prime Minister Micheal Martin in Luxembourg for a bilateral meeting with Prime Minister Luc Frieden

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