Ukraine minerals deal, consumer confidence, tax cuts and South Korea birthrate
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Today, what we know about the critical mineral deal between Ukraine and the U.S. Republicans advance Trump's tax cut plan. Plus, a turnaround for the birth rate in South Korea. It's Wednesday, February 26th. This is Reuters World News, bringing you everything you need to know from the front lines in 10 minutes every weekday. I'm Jonah Green in New York. And I'm Tara Oaks in Liverpool.

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Learn more at phrma.org slash IPWorksWonders. Just days after U.S. President Donald Trump was exchanging verbal blows with Ukraine's President Volodymyr Zelensky, the countries appear to have agreed a minerals deal.

Sources tell Reuters the draft agreement does not specify any US security guarantees or a continued flow of weapons. But it does say the United States wants Ukraine to be free, sovereign and secure. Mike Collett-White is editor-at-large for Ukraine and has been looking at the details. Well, the deal is to jointly develop between Ukraine and the United States. You

Ukraine's reserves of rare earths and critical minerals, which are used in high-tech devices and are sort of key to the future, as well as oil and gas. According to the details we've heard from sources about, there will be a fund established into which Ukraine would contribute 50% of the proceeds from exploiting state-owned resources until those payments reach $500 billion. And

And in return, the US says it will provide long-term financial commitments to a, in quotes, stable and prosperous Ukraine. What's not in there is the most interesting thing, and that is there is no mention of American security guarantees, which is what Ukraine had originally wanted from this deal. How has it gone from the war of words to this deal in a matter of days? Well,

Well, I think that the agreement the Ukrainians, if they were being honest, would say falls far short of what they would like. But the opening gambits in these negotiations over the last couple of weeks were deeply worrying to Kiev. I think the thinking in Kiev and for President Volodymyr Zelensky is, look, we have to engage. We have to show Trump that we mean business. And I think this is probably their only way of doing that, frankly.

Some of these minerals are currently in Russian-held Ukraine. How does that play out? If you look at the maps, there are sizable deposits of critical minerals and rare earths, both in Ukraine's controlled areas, i.e. the 80% of Ukraine that Ukraine still controls, and also in Russian-controlled areas. Interestingly, Russian President Vladimir Putin has

has said this week that Russia would be willing to work with America on exploiting their rare earths. So this is a very transactional phase and some of those rare earths he probably sees as those in occupied Ukraine. You can find out all about critical minerals in last week's episode of Econ World. It's out now wherever you get your podcasts. Israeli warplanes have targeted the Syrian town of Kiswa, 12 miles south of the capital, as well as the southern province of Daraa.

Hamas says it has resolved a standoff over the release of more than 600 Palestinians. The prisoners will now be handed over simultaneously with the bodies of killed Israeli hostages. For its part, Israel says it is considering extending the first phase of the Gaza ceasefire as it seeks to bring home the remaining 63 hostages. The White House says it will now pick which media organizations can be in the press pool that covers the president.

The move follows the decision to bar the Associated Press because it has declined to refer to the Gulf of Mexico as the Gulf of America. For decades, the White House Correspondents Association has coordinated the pool rotation on behalf of the public. Twenty-one workers have resigned from Elon Musk's Department of Government efficiency in protest over his wide-ranging cuts.

The White House says Musk will be present at President Donald Trump's first official cabinet meeting later today. Chile's government has announced a state of emergency after a massive power outage plunged the capital Santiago into darkness. It also knocked out electricity to major copper mines in the north of the country. The U.S. House of Representatives has advanced President Donald Trump's tax cut and border agenda.

Republican leaders spent hours persuading holdouts to back the move, which is a first step to extending Trump's 2017 tax cuts later this year. The House budget seeks $2 trillion in spending cuts over 10 years to pay for Trump's agenda. Still, fissures within the GOP might make it difficult to fully enact his policies, even with Republicans in the majority.

David Morgan covers Congress. One faction involves Republicans who might be described as being more moderate, and they have been concerned about push by Republicans on the right for deep spending cuts that have been aimed at Medicaid and food assistance programs for the poor and Pell Grants for students. Now,

Speaker Johnson and his leadership team have assured them that beneficiaries of Medicaid, which is the health insurance program for the poor, will not lose their benefits if they're U.S. citizens. There is another group that thinks there should be deeper spending cuts. Passing this budget resolution is just the first deadline facing lawmakers in the coming months.

They'll also need to enact spending legislation to prevent a partial government shutdown when current funding expires in three weeks. And later in the year, they'll need to act on the federal government's self-imposed debt ceiling or risk-triggering catastrophic default. So as this budget uncertainty plagues Congress, concern about Trump's other policies is sending consumer confidence plummeting to an eight-month low.

U.S. markets tumbled yesterday, pressured by this wavering confidence in the U.S. economy. Our U.S. economics editor, Dan Burns, is here to tell us more about what is driving that uncertainty.

Well, in a word, it's tariffs and trade. We saw a measure of consumer confidence from the conference board drop by the most single month in about three and a half years. And the conference board reported that unsolicited mentions of tariffs and trade policy and uncertainty around that were the highest in the survey since 2019.

And lo and behold, that's when Trump was in office the first time. And given the blitz of tariff threats that have come from him since he took office on January 20th, it's not all that surprising that it's really beginning to resonate with consumers who expect that to result in higher prices for the things they consume and potentially a threat to their job.

So is this one of those instances where consumer concern about inflation could actually become a self-fulfilling prophecy in some way? Well, that's the worry economists have. And let's be clear, it's not just consumers who are voicing concern here. Some national surveys have pointed to deteriorating sentiment around business conditions.

Expectations that prices are going to go higher for the inputs businesses need to produce the good or service that they put out. And some are talking about, you know, having to raise prices further as a result. And if you're gripping a cup or a mug or like me, some kind of a trough of coffee to perk you up during our morning pod, savor it while you can.

The price of coffee beans on wholesale markets is soaring and could soon filter through to consumers. You can hear all about this bitter news on this week's episode of Econ World Podcast, which is out later today. A round of applause and a check for $70,000 from the company's CEO. Not a bad baby bonus.

And in South Korea, it's the kind of policy push that seems to be encouraging parenthood. The country with the lowest birth rate in the world has seen it rise for the first time in almost a decade — to a modest 0.75. Efforts to incentivize companies and Koreans to embrace parenthood are paying off. For 35-year-old Nam Hyun-jin, it's worked.

Playing with her five-month-old second daughter. She says South Korea was a different place when she had her first. And she credits her employer for providing huge help after cashing her childbirth bonus. The 0.75 number is still well below what's needed to steady the population. And the government has plans to spend over $13 billion this year to try and lift the country out of its demographic crisis.

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Our recommended read today takes us to Moscow and a cold December morning in 1975 and the extraordinary efforts to smuggle a Nobel Peace Prize acceptance speech to Oslo. The writer, Soviet dissident and father of the Soviet hydrogen bomb, Andrei Sakharov. There's a link to find out more about the elaborate plot in the pod description. For more on any of the stories from today, check out Reuters.com or the Reuters app.

Don't forget to follow us on your favorite podcast player. We'll be back tomorrow with our daily headline show.