Monday, 31 August 2026

The Fed Puts Rate Hikes Back on the Table

Top Stories This Morning

Warsh signals the next Fed move may be up, not down

In his first Jackson Hole keynote as Fed chair, Kevin Warsh said he was impressed by the economy's strength but that underlying inflation trends have not improved, that financial conditions are not restrictive enough, and that the central bank may still have "work to do" — the closest he has come to saying rates may need to rise. Futures now put the odds of a hike by December above 70%.

Why it matters: Markets have spent two years pricing cuts; a Fed that is openly weighing hikes reprices everything from mortgages to emerging-market debt, and puts Warsh on a direct collision course with a White House demanding lower rates.

Sources: Federal Reserve · CNBC · NPR

Blast at an ammunition depot near Kyiv kills 38

A Russian drone hit a Ukrainian military ammunition store in the village of Myla, west of Kyiv, on Friday evening, setting off waves of secondary explosions that damaged homes and a care facility for elderly and disabled people. President Volodymyr Zelensky put the toll at 38 dead with four still missing, and ordered a criminal investigation into what he called "appalling negligence" in storing munitions next to housing. It came during three nights of near-continuous drone attacks; Ukraine struck back at the Kirishi oil refinery in Leningrad region and airfields in southern Russia.

Why it matters: The deadliest single incident in weeks was caused as much by where Ukraine stored its ammunition as by the strike itself — a rare admission of failure from Kyiv, and a reminder that both sides are now systematically hitting each other's logistics and energy infrastructure.

Sources: CNN · ABC News · Reuters via US News

Iceland votes against reopening EU membership talks

In Saturday's referendum, 52.8% voted against resuming accession negotiations with Brussels and 47.2% in favour, on a turnout of 82.5%. Prime Minister Kristrún Frostadóttir's centre-left coalition, which called the vote, said it would respect the result; she has said the membership question will not return to the political agenda during her mandate, which runs to 2028.

Why it matters: The referendum was pitched as a response to US tariffs and pressure over Greenland — and Icelanders still said no. For a Union trying to argue that enlargement is back, a rejection by one of the easiest possible candidates is an awkward result, and one Western Balkan capitals will read closely.

Sources: Al Jazeera · CBC · Euronews

Serbia & the Balkans

The fight over Mladić's funeral hardens across the region

Justice Minister Nenad Vujić confirmed that Ratko Mladić, who died in UN custody in The Hague on 27 August, will be buried in Serbia with full state and military honours, with the government organising the repatriation. Belgrade is still waiting for the tribunal to release the body, and the burial site depends on the family. Officials in the Bosnian Federation condemned the "public glorification of a convicted war criminal", Croatia's defence minister Ivan Anušić accused Belgrade of unfinished 1990s business, and commemorations were held across Republika Srpska; Aleksandar Vučić said it was "not a day for song or celebration".

Why it matters: A state funeral would make Serbia the first country to award official honours to a man convicted of genocide, at the exact moment it is asking the EU to move its accession file forward — and it lands weeks before an election campaign.

Sources: Balkan Insight · France 24 · European Western Balkans

Serbia's snap election is set for October — but still has no date

Vučić has said the early parliamentary vote will be held on either 18 or 25 October, with the exact date to be confirmed "in a few days". The election follows roughly 18 months of anti-government and anti-corruption protests triggered by the November 2024 collapse of the canopy at Novi Sad railway station, which killed 16 people. No date has been set for an early presidential election.

Why it matters: An 18 October vote would require the decree within days, compressing the campaign — and the government is simultaneously proposing new rules on how public officials may campaign, which will shape how level the field is.

Source: European Western Balkans

Serbia asked Moscow for firefighting help before it asked Brussels

With around 20 active wildfires, Serbia went nearly a month without activating the EU Civil Protection Mechanism, instead requesting a Russian Emercom Il-76 — which can drop 42 tonnes of water per pass — and citing the absence of an aircraft that size in the EU fleet. Belgrade formally asked the EU for help only on Friday; the bloc has sent four Black Hawk helicopters from Romania, Slovakia and the Czech Republic plus German and Romanian ground teams. The Deliblatska Peščara fire remains the worst, with more than 400 personnel deployed daily.

Why it matters: A candidate country reaching for Russian state assets before an EU mechanism it is already part of is exactly the kind of signal Brussels reads as alignment, and it has already drawn questions from the Commission.

Sources: Al Jazeera · Balkan Insight

World

Nepal flood toll passes 750 with more than 3,000 still missing

Five days after a glacier collapse in the Himalaya sent flash floods and landslides down the Trishuli and Bhotekoshi river systems, Nepal's disaster authority reported the death toll rising past 750, with Nepali and Tibetan authorities together listing more than 3,000 people missing. Rescuers are searching for over 900 workers at hydropower sites; a new lake formed by debris briefly forced operations to stop over fears of a second surge.

Why it matters: The trigger — a collapsing glacier and a debris-dammed lake — is the failure mode climate scientists have been warning about across the Himalaya, and the hydropower casualties show how much new infrastructure sits directly in its path.

Sources: Al Jazeera · CBS News

Business, Economy & Markets

Friday's session: stocks slip, gold slumps, yields climb

Wall Street closed lower on Friday as investors digested the Jackson Hole speech: the S&P 500 fell 0.25% to 7,711.76, the Nasdaq Composite lost 0.52% to 26,402.42 and the Dow was essentially flat, off 9.45 points to 53,559.99. All three still finished the week higher — the S&P up 0.5%, the Nasdaq 0.9%, the Dow 0.5% for its first winning week in three. The move was in rates and metals rather than equities: the 10-year Treasury yield ended at 4.73% and the 2-year at 4.34%, both up on the week, while gold fell 3.2% to about $4,454 an ounce as higher-for-longer real rates undercut the year's biggest trade. Europe went the other way, with the DAX up 0.77% to 26,570 on a carmaker rally led by BMW, Volkswagen and Mercedes-Benz. Brent settled near $88 and finished the week lower on easing Middle East risk; bitcoin held around $78,000.

Why it matters: Equities barely moved, but bonds and gold repriced hard — the market is treating a 2026 rate hike as a live possibility rather than a tail risk, and that is the assumption every asset class now has to be tested against.

Sources: CNBC · Advisor Perspectives · Trading Economics · Trading Economics (DAX)

Technology

Infostealer malware is hijacking AI accounts by stealing sessions, not passwords

Anthropic has begun warning Claude users that commodity infostealers — Vidar, LummaC2, StealC, RedLine and, on macOS, Atomic Stealer — lifted active session cookies from infected machines and used them to run up usage on victims' accounts. The company is force-signing-out affected users, removing saved payment methods and refunding charges it identifies as unauthorised. It says the malware is not specific to Claude and there is no evidence it was installed through the product.

Why it matters: Stolen session tokens walk straight past passwords and multi-factor authentication. As paid AI accounts accumulate real balances and connected tools, they become a target class of their own — and the compromise happens on the user's own device, not the provider's.

Source: BleepingComputer

Science

NASA's Roman Space Telescope is on its way to L2

The Nancy Grace Roman Space Telescope lifted off at 07:26 EDT on Sunday from Launch Complex 39A at Kennedy Space Center aboard a SpaceX Falcon Heavy, separating from its carrier about 31 minutes later on a trajectory to the Sun–Earth L2 point, roughly 1.5 million km away. Named after NASA's first chief astronomer, Roman carries a wide-field infrared instrument with a field of view at least 100 times larger than Hubble's; its core surveys target dark energy, dark matter and a statistical census of exoplanets.

Why it matters: Roman is built for breadth rather than depth — it is designed to map enough of the sky to measure how dark energy has changed over cosmic time, a question Hubble and Webb are not built to answer.

Sources: NASA · NPR

Automotive

Honda ties its next North American plant to the survival of USMCA

Executive vice-president Noriya Kaihara said Honda has nearly exhausted its North American capacity and needs an eighth plant in the region, but that "if there is no USMCA agreement in the future, we may have to change our direction". A decision is expected within a couple of years, targeting production around 2030. The warning lands mid-negotiation: Washington has imposed 50% tariffs on some $20bn of Canadian goods, and Canada has said retaliation begins on 8 September.

Why it matters: This is the first concrete case of a major carmaker putting a multi-billion-dollar plant decision explicitly on the trade talks — the point at which tariff uncertainty stops being a cost line and starts moving factories.

Sources: BNN Bloomberg · Quartz

Sport

Djokovic loses a US Open first round for the first time

On the opening night at Flushing Meadows, Novak Djokovic went out to Argentina's Mariano Navone 6-7(5), 7-5, 6-4, 2-6, 1-6 in four hours and 36 minutes — his first ever first-round defeat at the US Open, and the end of a 78-match Grand Slam first-round winning run. The four-time champion was in tears afterwards. World number one Jannik Sinner withdrew before the tournament with a knee injury; Carlos Alcaraz opened his campaign in his first singles match since April after a wrist problem, and Aryna Sabalenka came through on the women's side.

Why it matters: With Sinner out injured and Djokovic gone on day one, the men's draw has lost both its defining names before the first weekend — and Djokovic's pursuit of a 25th major now waits until 2027.

Sources: ESPN · Olympics.com

Today / What to Watch

German August inflation, ahead of the euro area flash tomorrow

The Bundesbank publishes Germany's harmonised August reading today, with Eurostat's euro-area flash estimate following on 1 September. Euro-area annual inflation was 2.9% in July.

Why it matters: If Europe's numbers are sticky too, the hawkish turn stops looking like a US-only story and starts constraining the ECB as well.

Sources: Bundesbank · Eurostat

Wall Street's first full session since Jackson Hole

US and European markets reopen today with the December rate-hike probability above 70% and gold coming off a 3% single-day fall.

Why it matters: Friday's move happened in thin late-August trading; today is the first real test of whether the repricing sticks going into the September FOMC.

Source: CNBC

Whether The Hague releases Mladić's body

Serbian officials say they are ready to travel as soon as the tribunal confirms the handover; the timing determines whether a state funeral takes place this week.

Why it matters: It sets the date for the largest test yet of how Serbia's government, the region and the EU handle official honours for a genocide conviction.

Source: Balkan Insight

The last full day of the European transfer window

The Premier League, EFL, Bundesliga, Serie A, LaLiga and Ligue 1 windows all shut at 23:00 BST on Tuesday 1 September, with a two-hour deal-sheet grace period after that.

Why it matters: Squads are locked until January, so anything a club has not fixed by tomorrow night it lives with for half a season.

Source: Premier League