NATO foreign ministers get their first chance today to discuss — in person (the omicron variant notwithstanding) — the Russian military build-up near the border with Ukraine. That’s at the top of the agenda for two days of talks in Riga, with NATO Secretary General Jens Stoltenberg warning yesterday that aggression against Ukraine “would come at a high price and have serious political and economic consequences for Russia.” Here’s our analysis of Russian President Vladimir Putin’s thinking, and on the window of opportunity for diplomacy. The Riga meeting will cover a wide range of topics, from the alliance’s strategic plans and how they fit with those of the bloc to lessons learned from the Afghanistan pullout. - John Follain and Katharina Rosskopf

What’s Happening

Omicron Summit | EU leaders are weighing whether to hold an emergency virtual summit on Friday on the arrival of the omicron variant even as the bloc was already battling sharply rising cases. The timing of the possible video call has yet to be determined.

German Curbs | Germany’s top court will publish a ruling today on the scope of restrictions the government can impose to tackle the pandemic. We're told that the outgoing and incoming chancellors, Angela Merkel and Olaf Scholz, will then hold talks with the 16 state premiers to discuss the ruling and consider their next steps, possibly including tighter curbs.

Delayed Rules | The European Commission is delaying new anti-greenwashing rules for fund managers by another six months, saying it won’t have enough time to review proposals from regulatory bodies. The new deadline of January 2023 means that the investment industry will have to wait longer for detailed information needed to correctly report environmental and social funding.

In Case You Missed It

‘Positive’ Start | Talks to revive Iran’s 2015 nuclear deal with world powers began positively Monday, according to a top European diplomat. Success in Vienna could lift sanctions on Iran’s economy and have major repercussions for oil markets and Middle East security. But U.S. officials remain pessimistic about striking an accord with Iran’s hardline government elected this year. 

Elected Again | Sweden’s Social Democrat leader narrowly won a vote in parliament to re-elect her as prime minister yesterday, easing the political turmoil in the largest Nordic nation that had led to her resignation. Having become Sweden’s first female prime minister last Wednesday, Magdalena Andersson resigned the same day when her junior partner in government quit following a defeat in parliament over the budget.

Laying Blame | With gas prices continuing to climb, the executive director of the International Energy Agency pointed his finger at the policies of producer countries, saying it's not the transition to a green economy that's at fault. That's a thinly-veiled reference to the likes of Russia and Gazprom, who have been slow to fill up storage facilities in the EU.

Shrinking Confidence | Economic confidence in the euro area slipped in November as consumers struggled with an inflation spike and resurgent coronavirus infections that turned the region into a pandemic hotspot yet again. A sentiment index fell to 117.5 in November from 118.6 the previous month. A gauge for consumers dropped to the lowest in seven months.  

Chart of the Day

German inflation surged more than expected in November. Prices increased an annual 6% under a EU-harmonized measure. A national gauge rose to 5.2%, the highest since 1992. ECB Executive Board member Isabel Schnabel tried to assuage concerns yesterday, explaining in a TV interview that “November will prove to be the peak.”  However, another record was reached in Spain, where the inflation rate of 5.6% was also the highest value in nearly 30 years. Today, consumer prices for the entire euro area are expected to come in at 4.5%.

Today’s Agenda (All times in CET)

• 9:30 a.m. German court decides on government Covid-19 powers
• 11 a.m. Euro area consumer prices 
• 1 p.m. Council President Charles Michel meets prime ministers of Georgia, Moldova and Ukraine 
• ECJ ruling on ECB Governing Council members’ level of immunity