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The US president came and went in The Hague, using his brief stopover at the NATO summit to pressure member countries to up their defence spending. Back home, multiple rapid interest rate cuts are starting to look more likely.

NATO SPENDING AND ROWS OVER NUCLEAR DAMAGE

Having flown in amid a flurry of social media posts and swearing, US President Donald Trump is already on the plane back to America. Trump has left the NATO summit in The Hague after witnessing nations pledge to up their defence spending (as he demanded), doubling down on his assessment of the damage caused to Iran’s nuclear facilities, and hinting he could provide Ukraine with more missiles.

The whirlwind nature of the world news cycle continued apace on Wednesday, with NATO leaders agreeing to “ramp up defence spending to 5% of their countries’ economic output by 2035”, the BBC reports.

NATO Secretary General Mark Rutte, who sent that fawning message to Trump telling him “Europe is going to pay in a BIG way”, said after the announcement: “No-one should doubt our capacity or determination should our security be challenged. This is a stronger, fairer and more lethal alliance that our leaders have begun to build.” Trump called it a “big win for Europe and … Western civilisation”.

The New York Times points out, however, that the wording of the communiqué issued by NATO states that “allies”, not “all allies”, had agreed to the 5% figure. Spain had pushed for the language to avoid committing to the target. The paper says the country is reportedly spending around 1.28% of its GDP on defence.

“Most of them, I guess almost all of them, are going to be contributing now 5%,” Trump said, adding: “Spain is terrible, what they’ve done. We’re negotiating with Spain on a trade deal; we’re going to make them pay twice as much. I’m actually serious about that.”

Much has been made of the way the summit was tailored to the erratic 79-year-old, and the US president suggested at a press conference before he departed the Netherlands that the efforts had worked, CNN highlights. “I came here because it was something I’m supposed to be doing. But I left here a little bit different,” Trump said.

Elsewhere during his whistle-stop visit, Trump declared the US will meet with Iran next week about a potential nuclear agreement. As the ceasefire between Israel and Iran looked to have held on Wednesday, Trump said: “We may sign an agreement, I don’t know. To me, I don’t think it’s that necessary. I mean, they had a war, they fought, now they’re going back to their world. I don’t care if I have an agreement or not.”

Following the reports from the likes of CNN and The New York Times, which suggested that preliminary US intelligence reportedly found Iran’s nuclear program had only been set back by a few months by the American strikes, Trump continued to insist Iranian nuclear sites had been “obliterated”, the ABC reports.

Lashing out at those reporting on the leaked assessment from the Defense Intelligence Agency, Trump called parts of the media “scum” who were trying “to make this unbelievable victory into something less”.

Reuters points out Trump also told reporters during his meeting with Rutte: “The intelligence says, ‘We don’t know, it could have been very severe.’ That’s what the intelligence says. So I guess that’s correct, but I think we can take the ‘we don’t know’. It was very severe. It was obliteration.” America’s ABC News adds the US president said “they presented something that wasn’t finished”.

Reuters also highlights that Trump compared the impact of American strikes to the end of World War II. Speaking at The Hague, he said: “I don’t want to use an example of Hiroshima. I don’t want to use an example of Nagasaki, but that was essentially the same thing that ended that war.”

Elsewhere, White House Press Secretary Karoline Leavitt posted a thread on X of those claiming Iran’s nuclear facilities had been “obliterated”, which mainly included members of the Trump administration. In the last couple of hours, the Director of National Intelligence Tulsi Gabbard also claimed on social media: “New intelligence confirms what @POTUS has stated numerous times: Iran’s nuclear facilities have been destroyed. If the Iranians chose to rebuild, they would have to rebuild all three facilities (Natanz, Fordow, Esfahan) entirely, which would likely take years to do.”

CNN points out the UN’s nuclear watchdog, the International Atomic Energy Agency, has said the conflict “severely damaged several” of Iran’s nuclear sites.

As the BBC and many others have reported, regardless of the scale of the damage, the major unknown now is whether the conflict will cause Iran to accelerate its nuclear program. Some commentators have also flagged questions over the legality of America’s actions, the country’s intelligence, and what other actors will do in the future as a result.

The other significant story from the summit on Wednesday was the US president meeting with his Ukrainian counterpart Volodymyr Zelenskyy. The New York Times reports Trump said he was weighing up sending additional Patriot air defence systems to Kyiv, but it was unclear if he would be donating them or selling them.

Writing on X, Zelenskyy posted: “Ukraine is ready to buy this equipment and support American weapons manufacturers.” He also said he had “presented the president with the facts about what is really happening on the ground”, declaring “Putin is definitely not winning”.

INFLATION DOWN, RATE CUTS EXPECTED

In domestic news, the Australian Bureau of Statistics (ABS) yesterday announced the monthly Consumer Price Index (CPI) was at its lowest level since October 2024.

The ABC reports the CPI dropped to 2.1% for the year to May, down from 2.4% the month before. “The annual trimmed mean, a measure of underlying inflation, was down to 2.4% in May, from 2.8% in April, which the ABS said was its lowest rate since November 2021,” the broadcaster added.

According to the Nine papers, that drop has paved the way for the Reserve Bank of Australia (RBA) to cut interest rates next month “and follow that up with even more relief for home buyers and businesses”.

The report states that the Commonwealth Bank now believes the RBA will follow up the May rate cut with back-to-back reductions in July and August.

Treasurer Jim Chalmers said on Wednesday that while it was too early to declare “mission accomplished” against inflation, “we are certainly making more progress than what we expected”.

Guardian Australia quotes Krishna Bhimavarapu, economist at State Street Global Advisors, as saying: “We are convinced that the RBA needs to cut in July to safeguard growth as inflation is clearly out of their way now.” KPMG’s chief economist, Brendan Rynne, stated there was a “continued pattern of deflation across the Australian economy”. He added: “This could provide comfort to the Reserve Bank at its next meeting, knowing that any cut to the cash rate will occur in a stable inflationary environment.”

Yesterday also saw a Coalition leader appear at the National Press Club — which obviously hasn’t happened in a while due to Peter Dutton’s aversion to it — with Sussan Ley’s address generating plenty of coverage.

The Nine papers report she told the Canberra audience “that no-one would get in the way of her resolve for the party to achieve gender equity and declared her openness to quotas”. The report also highlights Ley saying that she knows the pain of coercive control. “I understand the pain that comes with coercion and control because I have felt that pain too,” she said. “I understand what it’s like when you blame yourself for the actions of others. Because I have blamed myself too.”

The Australian picks up on the fact Ley said she was a “zealot” for bringing more women into the Liberal Party. The broadsheet also flags Ley pledged to create a “dedicated Coalition working group on energy and emissions reduction policy” amid the infighting over net zero.

Guardian Australia reports Ley will convene meetings of the shadow ministry and the Liberal partyroom this week. During the meetings, MPs will be allowed to air their grievances about the thumping election loss and contribute to the policy review, the site adds.

Finally, following the commitments made at the NATO summit, The Australian reports: “Anthony Albanese, Richard Marles and Jim Chalmers are actively considering increasing defence spending on missiles, drones, frigates and nuclear submarine facilities but will not bow to pressure from Donald Trump to lift Australia’s defence spending to 3.5% of GDP.”

ON A LIGHTER NOTE…

How do you fancy your own island, complete with a ruined castle?

Sotheby’s International Realty is selling Shuna Island in Scotland’s Inner Hebrides for a cool £5.5 million (A$11.5 million).

The listing declares: “Off the breathtaking west coast of Scotland, Shuna Island is a once-in-a-generation opportunity to acquire a private island of extraordinary scale, beauty and potential. Held by the same family for 80 years, this remarkable estate spans approximately 1,110 acres and is now offered for sale for the first time.”

For your $11.5 million, you get the island, the remains of Shuna Castle, and eight residential properties, which combined can sleep up to 52 people.

The island supports livestock farming and comes with a “robust renewable energy system” which includes “photovoltaic panels, wind turbines, battery storage and back-up generators”, the estate agent adds.

Given the current state of the world, it’s probably not a bad place to hide out (if you’ve got that $11.5 mil burning a hole in your pocket, of course).

Say What?

Then daddy has to sometimes use strong language. Mark Rutte

The NATO secretary-general’s blatant and at times cringeworthy charm offensive on US President Donald Trump continued in The Hague on Wednesday, with Rutte responding to Trump comparing Israel and Iran to “two kids” fighting.

CRIKEY RECAP

Joyous ABC staff demand apology as court rules Antoinette Lattouf was unlawfully sacked for opinions on Gaza DAANYAL SAEED Journalist Antoinette Lattouf speaks to the media (Image: AAP/Bianca De Marchi) ABC staff speaking to Crikey as the judgment made its way around newsrooms said there was “a lot of joy” among workers putting their own bulletins and shows together at ABC’s Ultimo headquarters today, as news of Lattouf’s victory became clear. One ABC staffer called the case a “fucking waste of money”, adding that “Kim Williams owes her (Lattouf) an apology over that National Press Club address.” Another staffer told us: “The ruling is not only vindication to Antoinette, who exemplified the ethos of journalistic integrity, reporting on Gaza without fear or favour, it is also a vindication for countless ABC staff members who supported her from the beginning. “It’s a happy day for journalists in the ABC and around Australia who now know media bosses will have to think twice before allowing their will to be influenced by a third party with vested interests.”

Jim Chalmers wants his economic roundtable to rise above party politics. Good luck! JASON MURPHY Jim Chalmers is hosting a meeting in August. An economic roundtable. The idea is to get 25 people in a room — 25 powerful people — and figure out what the government could do over the next three years to sort out the economy and the budget. “We have an open door and an open mind; this is a genuine attempt to see where we can find some common ground,” Jim Chalmers said last week. Chalmers also faces a whole lot of expectations given the thumping majority the government came out of the election with. The roundtable is expected to be a number of sessions focused on three priorities: productivity, budget “sustainability”, and economic resilience. I have some thoughts. Seven, in fact.

‘Combat the nutters’: Crikey readers on remaking the Liberals and US hegemony CRIKEY READERS [Falinksi] makes some interesting points. But in terms of the Liberal Party adopting that agenda, well, it’s all a bit of fan-fic unless the Liberal moderates find a way to combat the nutters who want to turn everything into a culture war. There’s not much point in having a brilliant plan to storm King’s Landing when the Army of the Dead is about to turn you all into zombies.

READ ALL ABOUT IT

Katharine Murphy quits as Anthony Albanese’s press secretary (The Sydney Morning Herald)

‘They told me to settle down, start a family’: Inside Fatima Payman’s rebellion (The Australian) ($)

Fix Howard’s problematic GST deal, Hewson urges Chalmers (AFR)

UK says it’s buying 12 F-35A stealth jets that can carry nuclear weapons (The New York Times) ($)

Wall Street reels from Zohran Mamdani’s victory in New York mayoral primary (The Financial Times) ($)

Residents say Waymo robotaxis are driving them mad. Can AI and humans coexist? (CNN)

THE COMMENTARIAT

Antoinette Lattouf has won $70,000, but her case has cost the ABC so much more — Karl Quinn (The Age): It has arguably never been more important that Australians should be able to trust in the national broadcaster to report fairly and accurately without caving to external pressure.

Balancing that with the right of individual journalists to hold and express political opinions won’t be easy. But that is the task the ABC must tackle if it is to move forward from one of the ugliest episodes in its long history.

The problem with Trump’s ceasefire — Thomas Wright (The Atlantic): Trump sought to address these dangers by ordering precise strikes on Fordo, Natanz, and Isfahan and then almost immediately leaning on Israel to accept a ceasefire so that the United States would not get drawn into a forever war. But the primary risk of the military option remains: If it was not completely successful, Iran could withdraw from the NPT and make the decision to build nuclear weapons.

Trump could have managed that risk by telling the public that although the strikes appeared to have been successful, fully ascertaining their results would take time. He could then have insisted on a week-long ceasefire for the purpose of concluding a diplomatic agreement with Iran — one that would have insisted on limits to Iran’s nuclear program and continued access for the IAEA, whose inspectors remain in Iran but have not been admitted into nuclear sites. Given the likely damage done to the program, he could have afforded to stop short of demanding full dismantlement and settled instead for strict limits on enrichment, as well as round-the-clock inspections with no expiration date.

But Trump took a very different path by declaring the problem fully solved and not using the moment of leverage to extract commitments from Tehran.

Nato members agree 5% defence target – the question now is whether Europe can deliver

Jonathan Beale

Defence correspondent, reporting from the Nato summit

This was a short Nato summit with a single clear purpose. To deliver on the one thing President Donald Trump has been demanding – that Europe and Canada spend more on their own defence.

Nato allies promised to raise defence related spending to 5% of GDP by 2035. For more than a decade that target was just 2%. Most European leaders were keen to avoid a rift with the US president – who in the past has raised doubts about America’s commitment to Nato allies. But the final communique re-affirmed Nato’s ironclad guarantee to collective defence.

Nato’s chief Mark Rutte heaped praise on Trump and gave him the credit: “America expects European allies and Canada to contribute more. And that is exactly what we see them doing.”

President Trump hailed it as a personal triumph, saying Nato was no longer a rip-off. “It’s a monumental win for the United States because we were carrying much more than our fair share. It was quite unfair actually. But this is a big win for Europe and for actually Western civilisation”.

Underlining the UK’s commitment to the US and the alliance, Keir Starmer confirmed the UK would purchase US jets – capable of carrying American owned and controlled tactical nuclear weapons. It marks the return of the RAF to nuclear deterrence for the first time in three decades, representing the biggest strengthening of our deterrence posture in a generation.

In reality, it’s also Vladimir Putin who has persuaded allies to ramp up defence spending. But while Russia was identified as a long-term threat, there was no direct mention of his war in Ukraine. President Trump has yet to deliver on his promise to bring an end to the conflict. But he still claimed he’d made the world safer.

This was a summit designed to keep America – Nato’s most powerful member – on side and to placate an unpredictable president. The question now is whether Europe can deliver.

Noordwijk, Netherlands CNN —

NATO leaders convening Wednesday in the Netherlands delivered President Donald Trump a major win by boosting their defense spending targets.

But comments he made while flying to the conference were raising fresh concerns about his commitment to the alliance’s core principal of collective defense.

The split dynamic — where leaders tailored their gathering to appeal to Trump, even as he questions the core provision of membership — made for a charged atmosphere as the conference was getting underway at The Hague.

Trump vowed to stand alongside fellow NATO nations a day after hedging in his support for the alliance’s Article 5 pact, which says an attack against one member is an attack against all.

“We’re with them all the way,” Trump said. “If you take a look at the numbers, we’re with them.”

He called a pledge to be agreed to Wednesday by NATO countries to increase their defense spending “very big news.”

“NATO is going to become very strong with us,” he said.

Trump, who spent the night at a Dutch royal palace after flying from Washington, attended the summit’s sole plenary session before meeting on the sidelines with Ukraine’s President Volodymyr Zelensky and holding a press conference.

He’s spending fewer than 24 hours in the Netherlands, an intentionally truncated visit that NATO leaders designed specially to keep Trump’s attention and ensure he didn’t have time to blow up the intended display of unity.

The central outcome of the summit — a pledge by members to boost defense spending to 5% of GDP in a decade, up from the current target of 2% — is exactly what Trump has been demanding over the past several years.

The final communiqué in which the spending target will be affirmed was dramatically shortened, omitting any controversial language that might spark resistance from the United States.

And while Ukraine and its president are still on the agenda, the country’s war with Russia will take a far less prominent place than in NATO summits past, a sign of the differences emerging between Europe and Trump over how to resolve the conflict.

NATO chief Mark Rutte, whose relationship with Trump extends back to his years as Dutch prime minister, elected to place the spending targets at the center of the summit and made sure to credit Trump for making it happen in a private message that Trump later posted on social media.

“You will achieve something NO American president in decades could get done. Europe is going to pay in a BIG way, as they should, and it will be your win,” Rutte wrote, before wishing the US president a safe journey to the Netherlands.

The fawning tone prompted some private eyebrow raising among European officials, but Rutte denied any discomfort when a reporter asked Wednesday whether the episode wasn’t a little embarrassing. And the NATO chief used even more evocative language later in the day, calling Trump the “daddy” who had to intervene after the US president compared Israel and Iran to “two kids in a school yard.”

As it turned out, Trump didn’t actually have to be at the NATO summit in order to raise fresh concerns about his commitment to the alliance, which he’s not been shy about criticizing in the past.

Speaking to reporters aboard Air Force One, Trump stopped well short of offering a full-throated endorsement of the alliance’s cornerstone Article 5 pledge of collective defense.

“It depends on your definition. There are numerous definitions of Article 5,” Trump said when asked about his commitment to the pledge, before adding: ”I’m committed to being their friends and I’m committed to helping them.”

It was not quite the show of support many European leaders had hoped for, though few officials voiced surprise at Trump’s comments as the summit was getting underway.

For his part, Rutte said he was unconcerned about Trump’s NATO commitment.

“For me there is absolute clarity that the United States is totally committed to NATO, totally committed to Article 5, and yes, there is also an expectation — that will be fulfilled today — that the Canadians and Europeans will speed up their spending,” he said.

This story has updated with additional developments.

As the North Atlantic Treaty Organization held meetings on Wednesday, leaders from the bloc of Western nations agreed to spend 5% of their gross domestic product on defense, NATO announced.

According to a NATO statement, nations will commit to spending at least 3.5% on core defense requirements. These nations will allocate an additional 1.5% of their GDP to protect infrastructure, networks, and civil preparedness. Nations will be expected to submit annual plans on defense spending.

Nations have until 2035 to reach the 5% target.

Previously, NATO leaders agreed to commit 2% of their national GDP to defense spending. However, according to U.S. government data, some nations did not meet that benchmark. For instance, Spain spent an estimated 1.3% of its GDP on defense in 2024, while Canada spent 1.4% and Italy spent 1.5%.

RELATED STORY | Trump joins world leaders at NATO summit as global conflicts loom

“I’ve been asking them to go up to 5% for a number of years, and they’re going up to 5% and that’s a big (jump) from 2% and a lot of people didn’t even pay the 2%, so I think it’s going to be very big news,” President Trump said. “NATO is going to become very strong with us.”

Canadian Prime Minister Mark Carney said his nation agreed to the increased spending.

“The world is increasingly dangerous and divided,” Carney said. “Canada must strengthen our defense to better protect our sovereignty, our interests, and our allies. These investments won’t just build our military capacity – they will build our industries and create good, high-paying jobs at home. If we want a more secure world, we need a stronger Canada.”

NATO is a 32-member alliance that has agreed by treaty to come to each other’s defense if attacked. The only time Article 5 of NATO has been invoked was following the attack on the U.S. on Sept. 11, 2001. NATO troops joined U.S. forces to fight the Taliban in Afghanistan.

The NATO alliance has grown since President Trump’s first term as Finland and Sweden have joined. There has also been discussion about how much of a role NATO should have in Ukraine’s defense against Russia.

During Trump’s first term, he was at times critical of the alliance, claiming some members were not spending enough of their GDP on defense.

A relaxed Donald Trump said Nato’s decision to increase defence spending to 5% of GDP was a “big win” for western civilisation in a digressive press conference at a summit in The Hague where he reaffirmed the US’s commitment to the military alliance.

There was every sign that the careful setup of the summit – in which most allies in Europe and Canada committed billions more on defence – had worked to keep Trump bound in to the alliance, with the US president praising Mark Rutte, its secretary general, and a night where he “slept beautiful” in the Dutch king’s palace.

Though he took issue with Spain for refusing to meet the 5% spending pledge and criticised CNN and the New York Times for reporting that Iran’s nuclear sites may not have been destroyed by US bombing, none of this disrupted the president’s overall pro-Nato tone.

1:11 ‘This ended the war’: Trump compares US strikes on Iran to Hiroshima – video

“When I came here, I came here because it was something I’m supposed to be doing, but I left here a little bit different, differently,” Trump said at the close of the summit. “I watched the heads of these countries get up, and the love and the passion that they showed for their country was unbelievable.”

The president described the summit as “a very historic milestone” in which Nato allies committed to increase their defence spending to 5% of GDP. It was, he said, “something that no one really thought possible. And they said: ‘You did it, sir, you did it’. Well, I don’t know if I did it … but I think I did.”

Though the headline commitment is for Nato members to commit to increasing defence spending to 5% of GDP by 2035, it will consist of 3.5% in core military spending and the rest in infrastructure, intelligence, cybersecurity and other spending that allies can already match. It means a real-terms increase of about £30bn in the UK after 2027.

Trump described this as “the Hague defence commitment”, saying it was “a monumental win for the United States, because we were carrying more than our fair share” and “a big win for Europe and for actually western civilisation” because Europe would now be “stepping up to take more responsibility”.

The US president has long been a sharp critic of the low levels of defence spending by other Nato members, and at the 2018 summit hinted the US might quit the alliance. During his 2024 election campaign, Trump suggested the US might not defend a country being attacked if it were spending less than previously agreed targets.

Those concerns sharpened after Trump’s election win, as Europe and Canada feared that he would reduce US engagement with Nato, shift closer to Russia, abandon Ukraine and rapidly move troops out of Europe. Though the White House is cooler on Europe and Ukraine than its predecessor, a sharp rift has been averted for now.

Earlier on Wednesday, Rutte offered sycophantic praise of the US president in his presence, saying that “Daddy sometimes has to use strong language” – a reference to Trump’s foul-mouthed outburst about Iran and Israel a day before. Just before heading to The Hague, Trump had accused both countries of not knowing “what the fuck they’re doing” after reports of breaches by both of a ceasefire he had imposed.

The Nato secretary general defended his tone towards Trump and denied it was demeaning, though he acknowledged it was “a bit of a question of taste”. Rutte said that Trump was “a good friend” and added: “Would you ever think that this would be the result of this summit if he would not have been re-elected president?”

Asked about Rutte’s comments, Trump reacted positively: “He did it very affectionately. ‘Daddy, you’re my daddy.’”

A day earlier, Trump had also released a series of flattering texts from Rutte. “You are flying into another big success,” said one, linking the Nato spending commitment with the bombing of the Iranian nuclear enrichment site at Fordow, showing him buttering up the president before the meeting.

The significant concession on defence spending, with most Nato countries spending a little over 2% of GDP now, was “not about US taxpayers paying more”, Rutte said – with the US nearly in line with the 3.5% military spending target – but about “Europe and Canada paying more” to, in most cases, increase their defence budgets.

Trump said he had a lunchtime meeting with Ukraine’s president, Volodymyr Zelenskyy, “to see how he is doing” and said in response to a question from a Ukrainian journalist that he pledged to supply Kyiv with Patriot anti-missile interceptors, some of which had been sent to Israel.

“We’re going to see if we can make some available,” Trump added, after asking the reporter where she and her family were living and sending his regards to her husband, a soldier. Later when he was asked if the US would restart military aid to Ukraine, stopped under his administration, he did not rule it out entirely. “We’ll see what happens,” the president said.

Live Live Trump shows concern for worried BBC Ukraine reporter during press conference – video

In his account, Zelenskyy described the meeting as productive, and said his priority was “the purchase of American air defence systems to shield our cities, our people, churches, and infrastructure” and said that Ukraine was willing to buy the equipment and “support American weapons manufacturers”.

However, in his closing press conference Trump continued to emphasise, with not much more than rhetoric, that “Vladimir Putin really has to end that war” and said he would try to speak to the Russian president again “to see if we can get it ended”.

The short summit communique, just five paragraphs long, did not repeat previous commitments to Ukraine’s “irreversible path” to Nato membership, reflecting the White House’s position. Trump continues to hope to persuade Moscow and Kyiv to agree to a ceasefire to halt the war, which is now in its fourth year.

Criticism was reserved for Spain, which said it believes it can meet its Nato commitments by spending only 2.1% of its GDP on defence. “I think it’s terrible,” Trump said, and he threatened to “make them pay twice as much” through trade sanctions, though this is an issue negotiated at EU level.

Trump digressed and failed to answer a question about the US commitment to Nato’s article 5, which says that an attack on one alliance member is considered an attack on all. Flying out to the summit on Air Force One, Trump had said “There’s numerous definitions of article 5, you know that, right?” but he never elaborated.