{"text":[[{"start":6.96,"text":"Stubbornly high inflation has set Donald Trump and Federal Reserve chair Kevin Warsh on a collision course this week as markets prepare for the central bank to raise interest rates in defiance of the president’s demands."}],[{"start":22.46,"text":"Economists warned the Fed’s “credibility” was on the line if it did not back an increase on Wednesday after official figures showed no signs of the meaningful improvement the Fed chair said he would need to see to avert such a move."}],[{"start":35.28,"text":"But raising rates for the first time in three years just weeks before November’s midterm elections risks provoking the ire of the president, who has made it clear he wants significantly lower borrowing costs."}],[{"start":47.16,"text":"Trump on Sunday reiterated his position that the US should have “the lowest interest rate in the world”."}],[{"start":52.84,"text":"Kevin Hassett, director of Trump’s National Economic Council, meanwhile, warned that “if it’s a rate hike, then the president will, you know, I’m sure he’s not going to be super happy about it”."}],[{"start":62.8,"text":"“I think if you want an independent Fed, then one thing the Fed does is it stays out of the way of elections,” Hassett told Fox News."}],[{"start":71.12,"text":"But Roger Ferguson, a former Fed vice-chair said the data now made it “far more likely than not” that the central bank would take action this week."}],[{"start":79.6,"text":"“Everything is pointing in the direction of September as a time to move if Warsh and his colleagues are going to maintain credibility,” he told CNBC."}],[{"start":88.76,"text":"The competing pressures set the stage for a stand-off between Trump and Warsh, whom the president nominated for the post, just four months into the Fed chair’s tenure. Trump lost patience with Jay Powell, Warsh’s predecessor, for not cutting rates quickly enough, branding him a “numbskull”."}],[{"start":105.64,"text":"Inflation has been elevated for much of 2026 as higher fuel prices triggered by Trump’s war with Iran feed through to other parts of the economy."}],[{"start":114.56,"text":"Oil prices surged again over the past week as Houthi attacks on Saudi infrastructure exacerbated supply concerns, pushing Brent crude past $100 a barrel to its highest level since May. Diesel prices topped $6 a gallon on Friday for the first time ever."}],[{"start":130.36,"text":"Warsh told economists and central bankers at the Jackson Hole symposium last month that price growth had become “more concerning” and that rate-setters would have “work to do” if it did not cool soon."}],[{"start":142.36,"text":"There was little sign of such cooling on Friday, when the Bureau of Labor Statistics reported annual consumer price inflation remained stuck at 3.4 per cent in August, unchanged from its July level."}],[{"start":154.56,"text":"The inflation report prompted many leading Wall Street banks to shift their forecasts on the Fed’s rate decision from a hold to an increase. Investor expectations of a rise moved from 50 per cent at the beginning of last week to almost 90 per cent on Friday."}],[{"start":169.32,"text":"“At the end of the day the chair’s repeated stern warnings on inflation intolerance risk institutional credibility absent some action to back it up,” said Michael Feroli at JPMorgan."}],[{"start":180.28,"text":"David Mericle at Goldman Sachs said policymakers would “worry about the potential market reaction to not delivering a hike that recent Fed communication has guided the market to now almost fully price”."}],[{"start":191.98,"text":"“Chairman Warsh’s Jackson Hole speech led the market to expect a hike if the inflation news was imperfect, and while the CPI was not concerning, it was imperfect,” he said."}],[{"start":202.36,"text":"Trump has said that while Warsh “wants to do the right thing” on interest rates, he may be foiled by a “political” and “hostile” Federal Open Market Committee, indicating he might not blame the Fed chair directly for any rate increase."}],[{"start":214.28,"text":"But such a move seven weeks ahead of the midterm elections, which will decide control of Congress for the second half of Trump’s term, would frustrate the president, analysts warned."}],[{"start":223.72,"text":"Gregory Daco, chief economist at EY Parthenon, said that “holding off on a rate hike until after the midterms, just like tightening solely for policy credibility, is not and should not be part of policymakers’ debate, despite becoming central to the market discussion”."}],[{"start":238.72,"text":"He predicted the Fed would raise rates with a majority of the FOMC persuaded that the speed of the disinflation process was “not satisfactory”."}],[{"start":247.24,"text":"“Chairman Warsh will likely use the cover of the majority to lead from behind and vote for a hike,” he said."}],[{"start":256.48,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1789367380_4331.mp3"}