Russian-American woman Ksenia Karelina, who was serving a 12-year prison sentence for treason in Russia, was released as part of a prisoner exchange that saw her swapped for an accused smuggler held in the US.

US Secretary of State Marco Rubio said on X early on Thursday that Karelina had been released and was on her way to the United States.

“American Ksenia Karelina is on a plane back home to the United States. She was wrongfully detained by Russia for over a year and President Trump secured her release,” Rubio said on X.

Russia and the U.S. carried out a prisoner swap early Thursday in Abu Dhabi in a sign of continuing confidence building, as the two sides pursue a deal to end the war in Ukraine.

Russian-American ballerina Ksenia Karelina was released from Kremlin custody in a prisoner swap with the United States Thursday morning.

Karelina was freed in exchange for German-Russian Arthur Petrov at a swap in Abu Dhabi, the Wall Street Journal reported.

“American Ksenia Karelina is on a plane back home to the United States,” Secretary of State Marco Rubio said.

“She was wrongfully detained by Russia for over a year and President Trump secured her release. @POTUS will continue to work for the release of ALL Americans,” he added.

Germany has said it "will not give in" and that Europe must "respond firmly" as US President Donald Trump targets imported cars and car parts with a 25% tax in his latest tariffs.

Other major world economies have vowed to retaliate, with France branding the move "very bad news", Canada calling it a "direct attack", and China accusing Washington of violating international trade rules.

Early on Thursday, shares in Frankfurt for Porsche, Mercedes and BMW fell sharply alongside French firm Stellantis, the maker of Jeep, Peugeot and Fiat.

Germany’s upper house of parliament on Friday passed a reform of the country’s borrowing rules and a 500-billion-euro ($542 billion) fund to revamp its infrastructure and revive Europe’s largest economy.

The constitutional amendment to loosen the so-called debt brake also allows for de-facto unlimited spending on defence and security.

The upper house of parliament, which represents the 16 German states, passed the bill with the necessary two-thirds majority after Tuesday’s vote in the lower house, the Bundestag.

The government of Germany on Wednesday updated travel guidance for people traveling to the United States after three of its citizens were detained in an attempt to enter "the land of the free."

Germany's foreign office warned German citizens that more strict immigration policies under U.S. President Donald Trump may land travelers in detention or face a possibility of deportation.

Germany’s Bundestag is set to vote on a major fiscal package later on Tuesday, which includes changes to long-standing debt policies to enable higher defense spend and a 500 billion euro ($548 billion) infrastructure and climate fund.

More than two thirds of parliament need to support the package in order for it to pass and become enshrined in Germany’s constitution. The law then also needs to be passed by the Bundesrat, a body representing the country’s states, on Friday.

Friedrich Merz, the likely next chancellor of Germany, announced on Friday that he had cut a deal with the Green Party to allow extensive new government spending for defense, infrastructure and projects related to climate change, appearing to seal the votes for a stunning turnabout in German fiscal policy before he even takes office.

The deal, which Mr. Merz announced after days of negotiations, paves the way for a vote early next week to pass measures that are billed as a response to President Trump’s moves to pull back American security guarantees for Europe.