Last updated: September 16, 2026, 10:01 PM ET
Federal Reserve Raises Rates for First Time Since 2023
The Federal Reserve raised interest rates for the first time since July 2023, a quarter-point increase that came less than a week before midterm elections and marked Kevin M. Warsh's first major move as chairman to contain inflation. The central bank lifted borrowing costs despite President Trump's public demand that rates be cut to 1% or less, with Trump urging policymakers to act while threatening to halt a broad swath of trade if the Fed did not comply. The Fed signaled another increase could be coming, and Warsh said inflation remains "too high," sending all three major U.S. stock indexes lower for the seventh time in the past eight sessions.
Market Reaction: Equities and Bonds
The Dow fell more than 600 points after the Fed's decision, with the 10-year Treasury yield hitting a 19-year high. U.S. stocks closed lower across the board following the rate increase. Bond traders had put the chance of an increase at about 94% ahead of the decision, and the bond market is now signaling growing confidence that Warsh can bring inflation under control. Ed Yardeni, one of Wall Street's biggest stock bulls, slashed his year-end target for the S&P 500 to 7,900 on downturn risks. The Fed meeting tested the credibility of policymakers with bond investors amid inflation fears.
Dollar Surges on Hawkish Warsh
The dollar notched its best day in three months as traders bet on further rate increases under a hawkish Warsh. Treasury Secretary Scott Bessent and Warsh face similar tests in calming bond markets. Foreign holdings of US Treasuries fell in July to the lowest level since October, reflecting waning overseas demand. The world economy is becoming wary of U.S. dollar dominance as America's position of global economic stability starts to look shakier.
What the Rate Hike Means for Consumers and Businesses
The quarter-point increase will add to interest costs for credit-card borrowers but won't directly affect most savings accounts. The Fed's move affects your finances across mortgages, auto loans, and credit cards. Elevated interest rates have raised the cost of mortgages and car loans without cooling the economy as much as expected. Lennar cut its deliveries target again on rate pressure and housing market conditions, expecting full-year home deliveries of between 80,000 and 82,000 homes. Consumer stocks like Walmart face pressure as the rate hike draws near, with stocks most closely tied to consumer health trailing the broader market.
U.S. Retail Sales and Consumer Strength
U.S. retail sales rose 1.2% last month, versus a 0.5% decrease recorded in July, in a show of consumer strength that complicates the Fed's inflation fight. American incomes hit a record last year even as an AI out-of-office reply cost one company $10,000 a day.
Oil Markets: Saudi Pipeline Attack and Hormuz Crisis
Oil extended its slump as Saudi Arabia moved to restore a key pipeline following attacks, posting the biggest drop in more than six weeks on signs of easing Middle East tensions. Saudi Arabia is ramping up prompt sales of crude from outside the Strait of Hormuz after a pipeline shutdown. Global oil prices could hit the highest levels in months after the Saudi pipeline attacks, with prolonged restrictions on exports potentially pushing prices even higher. Chinese oil prices hit record highs after the attacks, though Beijing has cushioned the global impact by drawing down stocks. Asian refiners are dusting off their early Iran-war playbook as oil jumps, preparing to cut run rates. Oil prices edged lower ahead of the Fed decision but remained near four-month highs. U.S. crude oil stockpiles posted a moderate draw, falling for a third consecutive week.
Natural Gas and LNG Markets
U.S. natural gas futures gained for a third session with warmer-for-longer weather forecasts supporting demand. European natural gas flipped to losses from earlier gains as traders weighed German stockpiling moves. The LNG market faces a prolonged Hormuz outage, according to Mitsui OSK Lines, which doesn't expect LNG shipments to normalize soon. The Hormuz crisis threatens to undermine long-term LNG demand growth, with soaring prices driving a search for alternatives in key Asian markets.
Precious Metals and Copper
Gold prices slipped after the Federal Reserve raised interest rates as expected, relinquishing earlier gains. Copper edged higher as US stocks and bonds found relief ahead of the Fed decision. Hong Kong's plan to build a global gold hub will provide an entry point for trading and boost commodities and yuan use. Zambia's Lusaka Securities Exchange will introduce its first-ever exchange-traded fund tracking gold and expects five stock listings.
Asian and European Markets
Stocks in Asia were poised for losses, tracking a decline on Wall Street after the Fed hike and dollar jump. European shares snapped two days of losses as a bond selloff and oil prices eased ahead of the Fed. Investor faith in Europe's stock market shows signs of fatigue as the rally becomes more concentrated, amplifying risks. Turnover in South Korean stocks fell to the lowest this year as investor enthusiasm waned.
Venezuela Oil Deals: Exxon, Continental Resources
Exxon is nearing a preliminary deal to invest in Venezuela's oil fields, negotiating a potential return to the Latin American country 19 years after exiting. Harold Hamm's Continental Resources signed a preliminary deal with Venezuela, led by one of President Trump's closest allies in the U.S. oil industry. The move by Continental Resources marks the latest foray by a western oil producer into the country. Trump lifted Venezuela's narco status and said Colombia may follow, removing Venezuela from the group of countries that failed to meet anti-drug obligations. Venezuela is preparing to ship aluminum to the US under a deal with Mercuria Energy and Heeney's gold deal.
Chelsea FC Ownership Shakeup
Chelsea Football Club owners Clearlake Capital agreed to buy out chairman Todd Boehly and Mark Walter as shareholders. The deal to sell 25% of the club for £950mn helps the financiers raise funds as their insurance businesses face pressure.
IPOs and Capital Markets
Holtec Nuclear Corp., a supplier of specialty services to the nuclear power industry, suspended its US IPO plan that had sought to raise approximately $900M. Goldman Sachs, HSBC, Fidelity and Eastspring are among major investors participating in NSE's $703M anchor book. Romania's debt managers told investors the country will curb its €10 billion foreign debt sale plan this year amid political turmoil. Traders are treating Romanian bonds as the European Union's only junk-rated sovereign debt, pocketing junk-like yields despite political crisis.
Corporate Bond Market Stress
Firms are shying away from long-dated bond offerings as costs rise, with Aon Inc. pricing $2 billion of notes maturing in 2056 as part of a broader trend. UK long bonds are struggling even as the government sells less, with the strategy to prop up long maturity debt failing to prevent yields from approaching 6%. AI-related debt is rivaling Treasuries in a bond market shake-up, representing imperfect substitution at best. Indian bonds are feeling the heat from the global yield surge, with the RBI's planned bond sales likely to put more upward pressure on yields.
Turkish Fund Crisis and Emerging Markets
Tera Portfoy Yonetimi AS said two of its funds with a combined 366 billion liras $7.5 billion in assets defaulted on redemptions. Turkish stock prices suffered sharp losses after the asset manager's default heightened investor fears. Turkish stocks slid in a fund run as investors withdrew $1bn, with index provider MSCI raising the prospect of cutting Turkey from emerging market to frontier status. Uganda's shilling slumped to a two-year low against the dollar, weighed down by surging foreign exchange demand. Senegal, which recently agreed a $2.2 billion bailout from the IMF, joined JPMorgan's list of African frontier nations set for a new bond index.
Hong Kong and China Markets
Hong Kong's property and technology firms may get a boost from Chief Executive John Lee's new five-year plan. The Hong Kong stock exchange is considering launching its first-ever bond index before the end of 2026 to boost the offshore yuan market. Hong Kong pledged to accelerate development of a technology hub near mainland China to boost home supply. China's central bank governor signaled a long period of massive credit growth has ended, saying the credit slowdown is a natural part of economic transition.
CATL and Asian Tech
Contemporary Amperex Technology Co. Ltd. suffered its steepest two-day drop in over a year, falling 10% as outlook worries mounted. Asian software and platform stocks have quickly gained favor with investors, emerging as the top AI trade in a Bank of America survey. Databricks says its business is accelerating as it piles investments into Asia.
OpenAI Financing and AI Industry
OpenAI is weighing financing at a $1.5 trillion valuation, a funding round that would double the value of the start-up behind Chat GPT. OpenAI disclosed misalignment incidents and adopted new rules for reporting them, hoping to inspire competitors to greater transparency. AI bosses' safety push sparked an internal rift at OpenAI and Anthropic, with staff grappling with how to turn AI slowdown goals into practice. At a private event this week, dozens of business leaders cited the AI safety threat as a top concern. Steve Bannon and Bernie Sanders condemned tech oligarchs and demanded AI reforms at a Washington event where partisanship took a back seat.
AI and the Workforce
Lower wage growth and slower hiring in some sectors may be the result of artificial intelligence quietly reshaping the workforce. A Times/Siena poll shows many voters are still uncertain on AI as a political issue, including many who use the technology daily. In Silicon Valley, hardware is having a moment again as venture capital flows into deep-tech and defense startups amid the AI boom. Marketers are navigating build-or-buy decisions in the AI era, with Grindr's CEO saying consumer brands are still spooked by the ghost of the Bud Light controversy. An AI antitrust exemption would invite collusion, as the law already allows Anthropic and OpenAI to collaborate if their real objective is not price-fixing.
Tech, Media and Telecom Roundup
Analysts provided insight on OpenAI, Soitec and other companies in the latest Market Talks covering tech, media and telecom. Fox is revamping the sports site Outkick following the exit of its founder, Clay Travis. The Toronto International Film Festival is hoping a new market can expand its reputation beyond an Oscar launchpad. AI is creating ghostwriting jobs on LinkedIn as CEOs look for a more human touch. The EU proposed banning social media and AI chatbots for children under 13 across the 27-nation bloc, with Ursula von der Leyen describing AI as the "second tipping point of our time."
Amazon, Reckitt and Corporate News
Amazon boosted its minimum pay for U.S. full-time core operations staff to $20 per hour, a $1-per-hour increase applying to front-line workers. Reckitt, the maker of Lysol and Mucinex, is expanding U.S. manufacturing amid global pressures. Reckitt is betting $400 million more on the U.S. supply chain, expanding a North Carolina manufacturing plant and a New Jersey campus. WH Smith expects profit to be at the bottom of its guidance range as inflation pressures margins. Morrisons reported the biggest sales increase in more than a year as hot summer weather and the World Cup boosted grocery demand. PwC UK revenues fell 3% to £6.2bn, the first drop in 20 years, as its Middle East consulting business was hit by a prolonged slump.
M&A and Deals
Brookfield agreed to acquire Australia's Reliance Worldwide for $2.9 billion, firming its US$3.38-a-share proposal for the plumbing-supplies manufacturer. KKR emerged as the preferred bidder to buy Portuguese packaging maker Logoplaste. Sazerac Co. is in talks to acquire German schnapps maker Berentzen-Gruppe AG. A court barred Ardagh Holdings, one of the largest makers of glass bottles and metal cans, from selling its metals packaging unit. Zillow Group lost its bid to force Illinois' largest provider of real estate listings to continue feeding data to its platform.
Hugo Boss, Fashion and Luxury
Hugo Boss appointed Michael Murray, the CEO of Frasers Group and Mike Ashley's son-in-law, as supervisory board chairman amid a takeover push. Murray, who has sat on the supervisory board since May 2025, will succeed the outgoing chairman. Dario Vitale, the Italian designer who left Versace last year, has joined Emporio Armani as creative director amid ongoing restructuring. Vitale's sole collection with Versace became almost mythic in fashion circles before his departure. McLaren launched its first SUV to compete against Lamborghini and Ferrari, hoping the move will increase sales and profits.
Energy Transition and Utilities
Ørsted's boss said Europe must act against "unfair" Chinese wind turbine makers, backing EU efforts to clamp down on China manufacturing. Nuclear fusion start-ups are attracting record investments, though some scientists think their timelines are unrealistic. Vietnam warned of power shortages from 2027 as power-generation and grid projects face delays. The U.S. needs permitting reform as electricity demand is projected to rise, and the country must build transmission infrastructure to keep up. Rising borrowing costs mean new financing instruments will be needed for developing countries to address climate change as the finance gap widens.
UK Economy and Politics
UK inflation pushed higher in August, with the rise in the headline rate almost exclusively down to higher energy prices. UK Chancellor John Healey faces fierce industry lobbying over a proposed gambling tax raid on high-stake slot machines, with the sector warning of thousands of job losses. Greater Manchester Mayor Andy Burnham is considering a plan to give mayors greater oversight of water companies, with the UK prime minister looking at creating nine regional bodies. The Bank of England faces issues with its Issue Department as part of its three balance sheet problems.
Regulation and Legal
The SEC moved to scrap rules governing how shareholders in publicly-traded companies can bring corporate proposals to a vote. Congressional Democrats led by Sen. Elizabeth Warren and Rep. Alexandria Ocasio-Cortez took aim at private equity's role in medicine with a bill to close loopholes firms use. The FCA introduced stricter rules to ensure people can speak up and be protected, warning firms about ethical failings after the Odey judgment. A hedge fund warned an ousted lawyer to settle a £36bn BHP dam collapse claim, in a case becoming a cautionary tale for litigation funding.
Geopolitics and Trade
The House directed Trump to halt the war with Iran or secure Congress's approval, the fifth time a chamber of the Republican-controlled Congress has voted on the matter. The Trump administration approved a $2.8 billion arms sale to Israel as fuel riots spread around the world. The Trump administration plans to deliver 60,000 one-ton bombs to Israel at a cost of approximately $3 billion. U.S. intelligence warned of China theft over the sale of F-35 jets to Saudi Arabia, according to internal reports including one from the Pentagon's Defense Intelligence Agency. The U.S. is pressuring Mexico to box out China's AI hardware exports as a landmark crypto bill failed a procedural vote, casting doubt on new digital-asset rules. The U.S. fast-tracked the deportation of José Serrano, a critic of President Daniel Noboa who has been accused of torture, despite torture fears. Trump imposed visa restrictions on South Africans over claims of anti-white discrimination. The Houthis said they had downed a Saudi F-15 after a Mecca drone accusation, as conflict escalated. The Houthis control key shipping routes, giving the Yemen-based militia significant geopolitical leverage. The U.S. indicted a Russian assassination network, alleging a former military officer in Russian intelligence services ran a global operation.
EU-Canada Relations and Trade
The European Union offered to make Canada its first "associate member" as U.S. ties weaken for both. The bloc's offer of associate member status to Ottawa shows how U.S. allies are adjusting to a shifting geopolitical landscape. New Zealand's parliament passed legislation enabling a free-trade agreement with India.
Sovereign Wealth and Institutional Investors
New Zealand's superannuation fund grew 14% despite being underweight on U.S. tech, with the world's best-performing sovereign wealth fund expecting an equities pullback. BlackRock aims to overhaul target-date funds with more options for retirement savers, making the corporate 401(k) look more like a pension. UniCredit's banker sees Poland's revved-up stocks having further to run as new investors pour cash into Eastern European equities. India's SEBI gave arbitrage mutual funds more flexibility in managing portfolios to aid an auction.
Crypto and Digital Assets
Bitcoin traded at $75,491 after falling around 4% a day earlier to as low as $75,000, hovering near a four-week low on a failed clarity vote. Strategy Inc.'s flagship preferred security is a whisker away from its original par value after buybacks pushed STRC preferred near par following a crypto selloff. Hackers demanded a $3mn ransom from Revolut after a data breach, with a group calling itself "iamnotavillain" threatening to sell customers' confidential records.
European Union Social Media and Tech Regulation
The EU proposed barring children under 15 from social media and AI chatbots, with Ursula von der Leyen describing AI as the "second tipping point of our time" after climate change. The proposed law would bar children under 13 from using social media across the 27-nation bloc.
Media, Culture and Society
Ellen Pollock, who has spent nearly a decade in charge of the Business desk of The New York Times, is stepping down. The New York Times marks its 175th anniversary, with dozens of editors and reporters reflecting on the milestone. Peter Max, the trippy artist of the counterculture era who became fabulously wealthy from work that breathed the spirit of the 1960s, died at. Annie Dillard, author of "Pilgrim at Tinker Creek", whose Thoreau-like account of journeys in the woods published when she was 28 won the Pulitzer Prize, died at. Julia Louis-Dreyfus returns to Broadway after more than four decades, driven by a "terrifying" desire to return to the stage. Stephen Colbert returned to late night on "Jimmy Kimmel Live," saying "People still do these shows?" in his first late-night appearance since his show ended.
U.S. Politics and Midterms
Democrats huddled in a meeting with more than a dozen Democratic senators putting aside disagreements on Israel to unite behind El-Sayed ahead of midterms. A wild primary season came to a close with snubs, flubs and dueling Dan Sullivans shaping the battles that set up the midterm elections. Aaron Guckian, a self-described "compassionate conservative," won the G.O.P. nomination for Rhode Island governor and will face Helena Foulkes. The Republican fringe is becoming the mainstream, with the G.O.P. facing a deepening neo-Nazi problem. Republican leaders brought Bo French, an anti-Muslim hard-liner, into the fold, testing Texas G.O.P. unity over his posts about University of Texas students. Members from both parties say the legislative branch has descended into a state of perpetual conflict, with "You're elected to fight and kill the other side" becoming a governing philosophy. Ultra-wealthy donors overwhelmingly back Donald Trump's party over Democrats as money flows into the 2026 midterms. US mega-donors overwhelmingly back Republicans, according to FT analysis, while China tightens overseas travel controls.
U.S. Domestic Policy
The House held Leon Black in contempt over Epstein subpoenas after the billionaire investor refused to appear for a deposition and turn over documents. The Trump administration moved to gut a core Endangered Species Act protection, with an internal memo reinterpreting the law so that only intentional killing of an animal is prohibited. The Interior Department detailed what it hoped to convey on 12 signs outside the Smithsonian museum. The House passed a bill mandating AM radio in new cars, defying automakers, with the bill now heading to expected Senate passage. The Senate took up a bill to regulate the "Wild West" of collegiate sports, with critics arguing the legislation would limit the rights of college athletes. Dr. Nicole Saphier, Trump's third nominee for surgeon general, appeared before the Senate for her confirmation hearing. The IRS won't say how much in taxes goes unpaid, with the absence of the annual estimate on the tax gap making it more difficult to craft policy.
New York and Local Politics
A judge ordered Zohran Mamdani to turn over communications with the Rent Board as New York landlords seek to invalidate a city panel's vote to freeze rents. An emergency hearing was sought over the Kennedy Center closure after a Democratic lawmaker asked a judge to consider whether the move violates the law.
Los Angeles Helicopter Crash
A news helicopter crash in Los Angeles underscored the risks of aerial reporting, as swarms of news helicopters traverse Southern California to capture its mayhem. The accidents left at least 5 dead when an S.U.V. broadsided a bus and then a news helicopter crashed back to back. A journalist and pilot who were on board the NBC4 news helicopter when it crashed had extensive experience in aerial reporting.
Health, Science and Medicine
Human brain tissue was grown in mice for the first time using a new genetic engineering technique that promises to aid the quest for treatments for incurable neurological conditions. A new simulation suggests little red dots, unusually compact objects seen in telescope images, may be the early stage of massive black holes. The Trump administration's shift at the FDA revived rare disease biotech stocks, with investors rushing in after the agency's hard-liners departed. A lawsuit blamed the Texas abortion ban in a pregnant woman's death, claiming state officials created a climate of fear that kept doctors from providing care. Experts say intrusive thoughts are common and mostly benign after childbirth, though Lindsay Clancy's case is an exception. What R.F.K. Jr. gets wrong and right about antidepressants is missing from the national conversation on mental health medication. Oura, the health technology company, will struggle to justify its pulse-racing $16bn valuation, needing more than celebrity endorsements.
Climate and Environment
Rising seas are gobbling up beaches around the world, and an experiment with roots at M.I.T. used AI and satellite images to grow a coastal beach in the Maldives. Scientists are testing new navigation systems to end GPS dependence, as military operations and civilian air traffic have been hit by satellite jamming. The Kremlin is pushing wheat exporters and growers to maintain Russia's geopolitical edge as the biggest wheat exporter amid Black Sea disruptions.
Labor and Employment
Security guards face rising risks but get paid little in return, following a recent high-profile shooting outside a mosque and rising threats to houses of worship. Airline pilots can earn fortunes in a single month but are often dependent on one airline, making their finances volatile. Salary stand-offs are delaying the abolition of NHS England, with health service leaders urging ministers to set up a temporary body to resolve the dispute.
Travel and Lifestyle
A wedding guests' guide to saying no is needed as flights and hotels become customary expenses in addition to gifts, but invitations keep coming. Experts say generic questions get generic answers when using AI to plan a trip, so better prompts are needed to avoid mediocre recommendations. Using AI to draft a will carries risks for those without complicated financial affairs who are worried about making a mistake.
Defense and Aerospace
The UK is looking at "land drones" to transform beleaguered Ajax fighting vehicles, with collaboration between General Dynamics and ARX Robotics aimed at making armored vehicles more capable. "Buy British" military procurement is a poor way to defend the realm, as if governments really want to keep defense purchasing close, one solution is deeper collaboration with allies. Jared Isaacman is using a decades-old playbook at NASA as he seeks to reshape the agency.
Legal and Professional Services
Sullivan & Cromwell launched a private equity practice, hiring a team of lawyers from rival Kirkland & Ellis in a push to capture more deal work. Switzerland's 26 cantons compete fiercely for companies, wealthy residents and tax revenue, turning tax competition into a national sport as Vontobel moves to Zug. Jacob Fugger accumulated a fortune estimated at $4 trillion in today's terms, making the Fuggers Europe's richest family ever. The Missoni family exited the brand it was known for its rainbow knits, followed by financial struggles and restructuring.
Automotive and Transport
Union Pacific, United Airlines, and J.B. Hunt Transport Services were in focus in the latest auto and transport market talk. United Airlines and American Airlines said they may need to cut capacity as fuel costs surge. Surging energy costs split companies over whether to raise prices now, with Elon Musk training his political chaos machine on the UK.
Trade and Export Policy
The Trump administration is targeting restrictions abroad with a plan to boost biofuel exports, following up on efforts to boost domestic biofuels. The U.S. is pressuring Mexico over AI-hardware exports as part of broader trade enforcement.
Tax and Fiscal Policy
New York Governor Kathy Hochul sent out $1 billion in "energy rebate checks" after accusing Trump of a "campaign bribe." The zero-risk society has arrived, and the U.S. achieved dominance by taking big chances, raising the question of where that ethos has gone.
China and Global Influence
A math teacher's viral post prompted a debate in China over whether learning English is worth the trouble in the age of AI. The American invasion of Iraq in 2003 paved the way for Tehran to dominate its neighborhood, showing how 9/11 helped create regional clout for Iran.
Ukraine and Russia
A colorful undercover recording drew attention in Ukraine, where a corruption case spawned memes and indignation and the prosecutor general was ousted. Russians are bracing for what the government might do on the military and economic front after the election, fearing post-election mobilization and economic pain.
Turkey and LGBTQ Rights
Turkey's government began a broad crackdown on the LGBTQ community, calling the campaign an effort to protect families while rights organizations condemned the move.
European Financial Regulation
Monaco is among several nations poised to exit a global financial watchdog's dirty-money "gray list," along with Bulgaria and Ivory Coast. Europe's new stock data tape finally went live this week, but industry groups say it needs more depth to be useful.
Entertainment and Culture
John Malkovich and Sam Rockwell discussed sinister characters and the politics underpinning their work in Martin McDonagh's dark comedy "Wild Horse Nine." Andy Burnham is in some ways a throwback to U.S. Catholic politicians of past decades, offering a model for JD Vance. Debates about Jews are never just about Jews, as for Trump, Jews are proving to be a very useful tool.
AI and Society
The "liftoff scenario" that terrifies AI doomsayers is "recursive self-improvement," the idea that artificial intelligence could learn to improve itself without human intervention. The evolution of AI from sci-fi to agentic workflows was surveyed in sell-side research at the end of the world, with the conclusion "This is good for AI!!!! Aaargh!!!!"
Fed Decision Analysis and Takeaways
Kevin M. Warsh, the Federal Reserve chairman, said the bank acted to fight inflation, in key takeaways from the Fed's decision to raise interest rates. The Federal Reserve increased its key rate by a quarter of a percentage point, affecting mortgages, credit cards, and savings accounts. Here's how to read the Federal Reserve's decision and what it means for the economy. The Fed's first increase since July 2023 came less than a week before midterm elections, with Hong Kong unveiling its first five-year plan and Chinese officials responding. The Federal Reserve's first rate hike since 2023 came as Treasury yields climbed and OpenAI held talks about a new funding round. Here's how to read the Federal Reserve's economic projections like a pro. Oil pared gains and stock futures held steady as cautious optimism heralded Fed day, with Treasurys strengthening slightly as markets were near-certain the Federal Reserve would raise rates. Oil fell and Asian stocks rose ahead of the Fed decision, with crude prices declining but remaining near multimonth highs. The Fed's rate increase was expected as Saudi Arabia scrambled to restore its oil supply and the EU and Canada deepened ties.