Good morning. Andrew here. Hope you had a great final week of summer. We’re waking up to a trickier economic picture today with Brent crude, the international benchmark, hovering around $99 a barrel — its highest level in weeks. Goldman Sachs warns it could hit $120 a barrel, while Treasury Secretary Scott Bessent suggests that oil could sink to $40 or $50 if the Strait of Hormuz fully reopens. (We’d love to see it, but we aren’t holding our breath.) Meanwhile, everyone’s discussing the surprise documentary film about Elizabeth Holmes that was recently screened at the Telluride Film Festival. We’ve got the early details below. (Was this newsletter forwarded to you? Sign up here.)
Bonds and bombsU.S. economic growth is holding up, bolstering Wall Street. But market indicators point to more expensive times ahead. Investors are bracing for more inflation data this week that could persuade the Fed to raise its benchmark lending rate for the first time in three years. That uncertainty is roiling the bond market, just as rising oil and copper prices (more on copper below) threaten to pinch households and businesses. The latest:
What to watch: The Bureau of Labor Statistics is expected to release the Producer Price Index on Thursday and the Consumer Price Index on Friday, the last batch of inflation data before the Fed’s meeting next week. Hot figures could push the central bank’s policymakers to raise borrowing costs, a move likely to irritate President Trump. Would the central bank make a move so close to Election Day? There’s precedent: In September 2024, the Fed, then led by Jay Powell, made the first of three rate cuts. And the futures market this morning sees a roughly 59 percent chance of a rate increase. Higher for longer: The inflationary effects of the war in Iran, bond market turmoil and a possible Fed rate increase point to a growing affordability crisis for some Americans. The spending crunch has become the top issue in some key Senate races, and it is even drawing concern from vulnerable Republican lawmakers.
Canada’s retaliatory tariffs on the U.S. take effect. Prime Minister Mark Carney’s response to President Trump’s latest levies on Canadian goods covers about $20 billion in American products, including aluminum foil, railway locomotives and steel bridges. The trade war appears set to escalate, after Trump called for a boycott of jets from Bombardier, a Montreal-based aerospace company, unless they were built in the U.S., where some parts are already manufactured. New York City wants to help private sector workers organize. Mayor Zohran Mamdani announced yesterday the creation of the Mayor’s Office of Worker Power, which plans to hold hearings on working conditions and connect workers to labor organizers. The move looks likely to increase tensions between Mamdani and New York’s business community. Officials investigate a deadly Amazon cargo plane crash in Miami. The National Transportation Safety Board said investigators were looking into the plane’s speed, weather conditions and safety at the airport as potential causes for the crash, in which the plane reportedly traveled about 1,300 feet off the runway and hit two vehicles, killing five. It’s the second fatal cargo plane crash at a major airport in less than a year. Chinese stocks slumps after a government stimulus plan disappoints. Shares in state-owned banks and insurers fell in Hong Kong after Beijing’s $54 billion capital injection into them was smaller than markets expected. It was the first time Beijing had offered the funds to insurers, as it tries to combat stress in the financial system amid slowing growth and continued problems in the property market. Anxiety over the copper rallyCopper is again in record territory, and that’s raising alarms with inflation hawks. The metal climbed above $14,509 per metric ton in London trading this morning, and is up roughly 17 percent this year, according to the London Metal Exchange. That’s stoking worries about the commodity, which is key to manufacturing and artificial intelligence infrastructure.
What’s driving the rally? Industrial demand is very high, and aging mines are struggling to keep up. Big Tech needs copper wiring for its data centers, while manufacturers use it in cars (especially electric vehicles), military equipment and more. Trade policies are also upending markets. The Democratic Republic of Congo, one of the world’s biggest copper producers, recently began curtailing some exports in a bid to bolster its lock on supplies. And then there’s Washington. The Trump administration has imposed a 50 percent tariff on global imports of some semifinished copper products, and traders have been bracing for even higher tariffs. As a result, merchants have been shipping refined copper for months to the U.S., where inventories have been filling up. That’s driving up the price around the globe. The rising price could worsen an affordability crunch. A 1 percent rise in copper prices appears to lift headline inflation by a tenth of a percentage point in some cases over a two-year period, the I.M.F. calculated in 2024. “Higher copper prices could complicate the inflation story,” Adam Turnquist, the chief technical strategist at LPL Financial, told DealBook in December. At that point, copper was trading below $12,000 per metric ton.
Europe’s A.I. champion shifts its ambitionsMost of the discussion in the artificial intelligence world revolves around mega-labs in Silicon Valley and China. A new fund-raising round by Mistral, the French start-up and Europe’s biggest A.I. player, reveals that the company wants to be included in the conversation. But the deal’s details also underscore how far the continent has fallen behind the dominant companies. Mistral said it had raised 3 billion euros (about $3.5 billion) in a round led by Samsung Electronics with contributions from the Scaleup Europe Fund, which has money from the E.U. The round values Mistral at €21 billion, up nearly 80 percent from last year. The round also shows Mistral is shifting its focus. Undergunned financially compared with its overseas rivals — Anthropic is valued at nearly $1 trillion, and OpenAI has raised $186 billion — the company is now concentrating on a narrower set of frontier A.I. abilities. It’s also building out cloud computing infrastructure, like data centers, for customers, especially those who want to keep their information in Europe.
Elsewhere in A.I.:
Talk of the town: that Elizabeth Holmes documentaryElizabeth Holmes is widely believed to be pursuing a presidential pardon. But few expected the disgraced founder of the blood-testing start-up Theranos to make a splash at the movies. The latest: “You Can See Everything,” a new documentary about Holmes co-created by Nathan Fielder, the absurdist comedian, made waves on Sunday at the Telluride Film Festival with a surprise screening. (Secrecy was so tight that security guards reportedly used night-vision goggles to monitor for any unauthorized recordings.) Hollywood has depicted Holmes’s rise and fall before, but the latest take, produced by A24, broke through in new ways. The movie was largely filmed in the San Diego house that Holmes shared with Billy Evans, her partner, in the weeks before Holmes went to prison in 2023. It mixes long, awkward interviews with attempts at radical transparency (Evans in the shower) and fictional re-enactments. (There’s also at least one plot surprise and an unexpected appearance.) What critics are saying:
What does Holmes think? She posted the trailer on social media and wrote, “I’m always being real.” We hope you’ve enjoyed this newsletter, which is made possible through subscriber support. Subscribe to The New York Times.
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