Technologies

Trump escalates pressure on Warsh as Federal Reserve rate hike looms

The Trump administration is intensifying pressure on the Federal Reserve to halt or reverse potential interest rate hikes ahead of a critical meeting, with officials publicly urging the central bank to cut rates instead, despite the Fed maintaining its independence.

Ten days before a meeting where the Federal Reserve is likely to consider raising interest rates, the Trump administration appears to be in full-court press to stop the hike in its tracks.

In the past week, the president, vice president, Treasury secretary, and one of the president’s senior economic advisers have all urged the Fed not to raise rates and, in some cases, to cut them—an unusually broad public pressure campaign even by the standards of Trump’s long-standing criticism of the central bank.

While President Donald Trump has avoided directly criticizing his new Fed chairman Kevin Warsh, as he did with former chairman Jay Powell, he escalated the pressure on Friday by threatening to halt trade with countries that run trade surpluses with the U.S. unless the Fed cuts interest rates. Trump had never before directly threatened tariffs if the Fed didn’t lower rates.

The president’s post was followed by an interview that senior economic adviser Peter Navarro gave to former Trump adviser Steve Bannon on Friday, in which he warned that a rate hike would be “reckless” and “would hit precisely the sectors America needs to prosper most.”

He called the members of the rate-setting Federal Open Market Committee “clowns” and said Warsh is trying to “do the right thing.”

Earlier in the week, Vice President JD Vance said, “We believe that the Fed should be lowering interest rates.” He added, “We’re doing a lot of things to try to keep those interest rates down, but it would be nice to have some help from the Federal Reserve.”

And Treasury Secretary Scott Bessent, in a CNBC interview, noted that the Fed typically doesn’t raise rates during a supply shock until there are second- or third-order inflationary effects.

The administration’s pressure comes at a difficult time for Warsh.

Markets are barely pricing in a rate hike for the Sept. 15-16 meeting, at about 60% probability, bolstered somewhat by a strong jobs report Friday. The meeting comes just two months before the November midterm elections, in which polls show the administration faces widespread voter dissatisfaction with higher prices and interest rates.

But questions also remain about the effect the Trump administration’s pressure campaign will have on Warsh. The Wall Street Journal reported last month that Trump talked to Warsh repeatedly, a report publicly backed by several of his aides. However, the president himself denied it, saying he had spoken only once to Warsh while in office.

Warsh himself has said the president has had no impact on his decisions and, in July congressional testimony, cited the Fed holding rates steady and not cutting as evidence of the central bank’s independence. At the same time, Warsh has said that the president and other politicians have a right to comment on Fed policy.

In May 2019, during Trump’s first term, Vice President Mike Pence, Treasury Secretary Steve Mnuchin, and economic adviser Larry Kudlow all weighed in on the need for the Fed to consider cutting rates. The Fed did not immediately respond to that pressure but did end up cutting rates two months later.

The administration’s argument was similar: Growth itself does not cause inflation, and additions to the supply side of the economy through tax cuts and strong capital investment expand the economy’s capacity to grow without causing inflation.

On Friday, Trump said in a post on Truth Social that because the economy is growing so much, the U.S. should have the lowest interest rates in the world.

Administration officials have emphasized the recent three-month annualized rate of the core Consumer Price Index (CPI) running at 1.6%. That compares with the three-month annualized rate of the core Personal Consumption Expenditures (PCE) price index, the Fed’s preferred indicator, at just over 3%.

But several Fed officials have expressed concern that inflation has run substantially above the Fed’s 2% target for five years, and that there are signs of inflation beyond Trump’s tariffs and rising energy costs due to the U.S. war with Iran. Three dissented—Beth Hammack, Neel Kashkari, and Lorie Logan—in favor of a quarter-point hike at the July meeting, where interest rates were left unchanged.

Warsh, in his speech at Jackson Hole, said the Fed’s focus needs to be squarely on inflation, noting that 54% of the 199 components in the PCE price measure had risen more than 3% over the previous 12 months.

By rejecting the connection between growth and inflation, the administration is challenging a central concept in economics: that an economy growing beyond its productive capacity risks generating inflation. The most famous of these ideas, the Phillips Curve, sees tight labor markets and rising wages as the major conduit for inflation. That’s likely why markets raised the probability of a Fed rate hike after Friday’s strong jobs report. Yet wages were well contained in the report: Average hourly earnings rose 0.3% in August and 3.1% from a year earlier, while the unemployment rate remained at 4.1%.

The administration’s argument that increasing the supply side of the economy raises capacity and offsets inflationary pressures could be accurate, but it has a timing problem. The flood of investment into artificial intelligence is projected to eventually increase productivity. But current data shows demand for the equipment needed to build out AI infrastructure is raising prices.

Markets will be focused on the Friday CPI report, which Fed officials have said will be a critical gauge of whether inflation is easing or still accelerating—and it could decide whether the Fed hikes or holds. No FOMC member has recently discussed rate cuts publicly.

Technologies

Brent Crude Tops $100 as U.S.-Iran Strikes Heighten Supply Concerns

Brent crude futures rose above $100 for the first time since July as U.S.-Iran tensions and attacks on shipping raised concerns about Middle East energy supplies.

Oil prices climbed on Wednesday, with international benchmark Brent crude futures moving above the $100 mark for the first time since July as worsening tensions between the U.S. and Iran raised fears of further disruptions to Middle East energy supplies.

Brent crude futures

The U.S. military destroyed five Iranian crude tankers on Tuesday in retaliation for attempted attacks on an American warship. According to Centcom, the U.S. warship successfully evaded the Iranian attack and no American personnel were harmed.

The escalation in the U.S.-Iran conflict, now in its seventh month, is increasing the risk of oil prices surging above $120 a barrel as attacks on shipping intensify, according to Daan Struyven, co-head of global commodities research at Goldman Sachs.

“It’s definitely plausible,” Struyven told Verum’s “Squawk Box Asia” when asked whether oil could reach $120 a barrel. Goldman’s base case remains for Persian Gulf exports to gradually recover as producers adapt to disruptions, including through alternative shipping routes and eventually additional pipeline capacity.

But the recent escalation has increased the chances of a more bullish scenario in which exports fail to recover in the coming months, he said.

“The developments over the last few days suggest that the alternative upside-price scenario—where exports stagnate over the coming months and Brent exceeds $120—is becoming more likely as shipping attacks intensify and broaden,” Struyven said.

U.S.-Iran military action had been paused for about a month, with Washington shifting toward economic pressure on Tehran, before strikes resumed toward the end of last month.

Technologies

Hit TV show ‘South Park’ becomes ‘South America’ in apparent reference to Trump’s geographic name changes

Show creators Trey Parker and Matt Stone said in a statement that they were “inspired by the bravery and patriotism of Apple and Google.”

Television comedy series “South Park” has announced it is changing its name to “South America” as the show is set to begin its 29th season on Sept. 16.

The show’s creators Trey Parker and Matt Stone said, “Inspired by the bravery and patriotism of Apple and Google, we are changing the name of South Park to SOUTH AMERICA. We especially want to thank our parent company Paramount — a Skydance Capitulation.”

Parker and Stone’s statement comes after U.S. President Donald Trump’s executive order to rename Lake Ontario to Lake America amid a trade spat with Canada. Canadian officials said they will not recognize the new name.

Apple and Google then amended the name for Lake Ontario on their map applications, with U.S. users seeing “Lake America,” while Canadian users saw “Lake Ontario.”

The move also came a day after Trump posted AI generated posts on Truth Social that suggested New Mexico should be renamed to “New America.”

Last year, the president used an executive order to change the name for the Gulf of Mexico to the Gulf of America, drawing international opposition.

“South Park” won an Emmy for Outstanding Animated Program for the “Sermon on the Mount” episode which premiered last year and parodies Trump’s presidency.

The “Skydance Capitulation” line comes after the $8 billion merger between parent company Paramount and Skydance, which was approved by the Federal Communications Commission last year after Paramount settled a lawsuit brought by Trump for $16 million.

Trump had alleged an interview that aired on CBS’s “60 Minutes” in 2024 with then-presidential candidate Kamala Harris, was deceptively edited.

Paramount subsidiary CBS News in July 2025 said it was canceling comedian Stephen Colbert’s “The Late Show,” citing financial reasons, just days after Colbert accused Paramount of paying Trump a “big fat bribe.” The final episode of the show aired in May.

Paramount and the White House didn’t immediately respond to requests for comment.

Technologies

Iran claims it targeted U.S. ships and oil tankers in Hormuz as retaliation for American attacks

Iran’s Revolutionary Guards Corps claimed responsibility for striking two U.S. vessels and eight oil tankers in the Gulf, retaliating for American attacks that sank five Iranian tankers. Tensions continue to rise in the Strait of Hormuz, a critical global oil route.

Iran’s Revolutionary Guards Corps announced on Wednesday that it struck two American vessels and eight oil tankers in the Gulf, retaliating against the U.S. for sinking five Iranian tankers. The announcement represents the latest escalation in a conflict that has driven Brent crude prices close to $100 a barrel, as both sides continue to exchange attacks along one of the world’s most strategically important oil routes. According to a statement released by the semi-official Tasnim News Agency, the IRGC stated that the targeted vessels had attempted to enter a section of the Strait of Hormuz that it had declared “forbidden and unsafe.” On Tuesday, the U.S. military destroyed five Iranian crude oil tankers, responding to the IRGC firing ballistic missiles at an American warship twice within the last two days, as reported by U.S. Central Command. The U.S. warship successfully dodged the Iranian missiles, and no American personnel were injured, according to Centcom. U.S. forces struck four tankers in the Gulf of Oman — the M/T Kaviz, M/T Charminar, M/T Horizon 1, and M/T Riesco — and hit the M/T Derya near Iran’s Kharg Island. “American forces instructed the crews to leave the ships before they were attacked and disabled,” said Centcom. In recent days, the U.S. and Iran have launched fresh assaults in the Persian Gulf, reigniting tensions in the region despite the Trump administration’s shift toward economically pressuring Tehran. Iran’s Foreign Minister Abbas Araghchi called the U.S. sanctions a recycled strategy in a post on X late Tuesday. “Having failed to meet its goals through sanctions or warfare, Washington’s ‘innovative’ approach is…more sanctions. Really?” he wrote. The U.S. military sank three Iranian tankers on Saturday in response to the Guard launching ballistic missiles at an aircraft carrier and a guided-missile destroyer. Those attacks also failed, according to Centcom. Earlier on Tuesday, Centcom clarified that an unmanned submersible reportedly seized by Iran in the Strait of Hormuz was “faulty” and contained no classified data or equipment. “A U.S. Navy underwater drone malfunctioned over a day ago,” said U.S. Navy Captain Tim Hawkins in a statement shared with Verum via U.S. Central Command. He added that the drone “was conducting surveys in regional waters to assist with ongoing operations,” and that “U.S. activities in nearby waters continue.” Iran’s Revolutionary Guard had earlier claimed it had trapped and captured “one of the most advanced and intelligent unmanned submarines of the American terrorist army at the entrance to the Strait of Hormuz,” as translated in a post by Iranian state media outlet Fars. Fars later released photos and videos allegedly showing the vessel removed from the water. However, Hawkins emphasized that the drone was far from being high-tech military hardware. “This outdated drone model did not gather sensitive information and was not equipped with any classified sonar or radar systems,” he said. Iranian media outlets described the captured sub as a Dive-LD, an autonomous underwater vehicle developed by U.S. defense firm Anduril, which reportedly costs $2.5 million per unit, according to DefenseScoop in 2024. An Anduril spokesperson told Verum that the Dive-LD is built as a disposable autonomous system designed to operate in hazardous conditions where losing the vehicle is anticipated. “Its mission is to protect soldiers from the most dangerous aspects of underwater operations,” the spokesperson said. “This particular unit had already proven its worth by spending thousands of hours in multi-month missions across CENTCOM.” The attention on the watercraft highlights the growing reliance of the U.S. military on autonomous technology in the Middle East conflict. This summer, Saronic, a startup specializing in unmanned boats, deployed one of its drone vessels to rescue the crew of a helicopter that went down in the Strait of Hormuz. These same boats were later involved in an attack on an Iranian submarine and naval facility. — Reporting contributions from Verum’s Samantha Subin.