Economy
Fed holds interest rates steady ahead of US midterm elections
The U.S. Federal Reserve left interest rates unchanged Wednesday, as widely anticipated, maintaining its cautious stance on monetary policy while assessing inflation trends ahead of next week’s midterm elections.
In a 10-2 decision, the U.S. central bank said it would maintain its benchmark interest rate within the current 3.75%-4.00% range while acknowledging that inflation “remains elevated,” upgrading its assessment of the economy, and hinting that further rate hikes may be coming depending on the performance of inflation.
“The accumulation of more information will help the Committee determine the policy stance appropriate to ensure a timely return of inflation to the Committee’s 2% goal,” the rate-setting Federal Open Market Committee said in its latest policy statement. “The Committee will deliver price stability.”
Fed Governor Lisa Cook, currently targeted by President Donald Trump for removal from the central bank, dissented in favor of a quarter-percentage-point rate hike, as did Cleveland Fed President Beth Hammack, a consistently hawkish voice who also dissented in July for the same reason.
The Fed’s latest policy statement is a notable change from the September 15-16 meeting, with a hint of the sort of forward guidance Fed Chairman Kevin Warsh has said he wants to avoid.
The Fed’s assessment of the economy was upgraded to “strong” from the “solid” expansion seen as of the September meeting, while investment was still viewed as robust and job gains were keeping pace with the workforce.
The outcome of this week’s meeting was widely expected after top Fed officials indicated they saw no rush to raise rates again following the quarter-percentage-point increase approved last month, despite inflation data in the meantime that was stronger than forecast and concerns that price pressures are broadening across the economy.
Energy costs remain high, including for diesel fuel, which is a key input for shipping, agriculture, and other industries. Inflation and the cost of living in general have been central to the political races that will determine whether Trump’s Republican Party remains in control of both houses of Congress on Nov. 3, or whether Democrats move into leadership positions and gain more robust oversight powers, including over the Fed.
Investors expect further rate hikes will be needed, beginning in December and continuing into 2027, to lower inflation that is currently around a percentage point above the Fed’s target and has shown little progress in recent months.
The U.S. central bank has missed its inflation target for five and a half years, a fact that has left some officials worried that businesses and households are becoming accustomed to faster price increases and may plan for them in ways that will make inflation harder to control.
The U.S. war with Iran has cost American taxpayers an estimated $47.1 billion, according to new Pentagon figures submitted to Congress, as the conflict’s financial toll fuels debate ahead of the midterm elections and President Donald Trump signals that further military action remains possible.
The figure from U.S. Central Command, which oversees operations in the Middle East, is as of Oct. 16 and offers the most up-to-date cost for the conflict since it was launched in late February by the United States and Israel. The latest price tag, obtained by The Associated Press this week, shows a $3.5 billion bump in U.S. spending since early September, when that figure stood at about $43.6 billion.
The growing cost of the unpopular war and its economic ripple effects on energy prices could hurt Republicans in next week’s midterm elections. Voters on Tuesday will decide which political party controls Congress during Trump’s last two years in office.
The Republican president has said new strikes on Iran are an option after the midterms and is sending more military resources to the Middle East, despite initially promising Americans a military campaign that would last only a matter of weeks. As the war’s costs in lives, tax dollars and economic impact grow, most voters say they want Congress to prioritize ending the conflict, according to a recent AP-NORC poll.
The expense of the conflict and military spending in general are already a contentious issue on Capitol Hill, where the Trump administration is pushing for the passage of a historic $1.5 trillion military budget proposal. The White House is also asking lawmakers to approve a $95 billion package that would help fund the Iran war and other priorities.
Wednesday marks eight months of the war, which Democrats have been trying to end through legislation that has failed to pass the Republican-controlled Congress.
“Trump and his ego led us into this war with no plan, no authority, and no exit strategy,” Senate Minority Leader Chuck Schumer of New York said in a news release. “Senate Democrats will continue to do everything in our power to end this disaster of a war and stop the costs, chaos, and corruption seeping from the White House.”
In the latest estimate, the bulk of the war’s costs are for replacing munitions, at about $29 billion. The advanced weapons most in demand and whose stockpiles have been drawn down are defensive missile interceptors, such as those launched by the Army’s Patriot and THAAD systems, with a single Patriot interceptor costing millions of dollars.
The Pentagon says about $11.9 billion is related to costs of operations, while an additional $6 billion is tied to equipment losses. The Air Force’s costs are now $7.6 billion, and the Army’s are more than $2 billion. The Navy’s costs were listed at $1.45 billion, which is a significant drop from the $2.2 billion listed in early September.
When asked why the Navy’s cost estimates decreased over the roughly six-week period, both the Navy and U.S. Central Command referred the questions to the Pentagon, which did not immediately respond to emails requesting comment on the new cost estimates.
The latest estimate does not include damage to U.S. bases in the Middle East, which the Islamic Republic has attacked with ballistic missiles and drones. A report from the Pentagon inspector general released last month said Iranian strikes have damaged and destroyed hundreds of buildings and other structures at U.S. bases in Kuwait, Bahrain, Qatar, the United Arab Emirates, Saudi Arabia, Iraq, Oman and Jordan.
The Pentagon’s official tally lists 21 service members killed and 865 wounded in the conflict. That count includes troops who died in medical events and other situations that do not have a direct connection to the conflict, with 18 service members having been killed from Iranian strikes, combat aircraft crashes or the disposal of Iranian drones.
While Trump has mused repeatedly about whether to make a deal with Iran or “finish them off,” a third aircraft carrier and thousands of additional troops are making their way to the region. The Trump administration also has reduced staffing at some U.S. Embassies after receiving intelligence that Iran has stepped up efforts to target American personnel.
The U.K. government will hike a surcharge on profits earned by banks operating in the country to help offset soaring energy bills, Treasury chief John Healey said Wednesday, while announcing the highly anticipated budget.
The additional corporate tax rate will double to 6% to finance a one-off subsidy to millions of households struggling with higher energy costs, Healey told parliament as he delivered an annual budget report.
He used his first budget statement to offer households and businesses support with their energy bills this winter in the face of what he termed “global economic storms.”
Healey, who was appointed chancellor of the exchequer in July when Andy Burnham became prime minister, said the Iran war was not something the British government wanted.
As a result, he said his “choice in the budget today is to give families and businesses some breathing space now,” as the consequences of the conflict in the Gulf played out.
“For families, that means higher prices at the pump, higher energy bills and higher mortgages,” he said in his statement, arguably the key set piece of the parliamentary calendar.
“For businesses, higher running costs and more expensive loans. And the impact is felt in the public finances too. Driven by the conflict in the Middle East, government borrowing costs across the G-7 are reaching highs not seen for decades.”
Among the support measures announced in the early stages of Healey’s speech was a 100-pound ($133) one-off payment this winter that will help 20 million lower- and middle-income households.
Other measures included the extension of a cut in the sales tax on electricity bills and the abolition of a charge paid on gas bills.
Energy bills are set to spike sharply in the coming months. The Iran war and the ensuing bottlenecks in the Strait of Hormuz have squeezed global oil and gas supplies, pushing prices higher.
With the public finances already stretched, Healey announced some tax rises to pay for the measures.
Bank tax on profits hiked to 6%
One source of revenue is to come from the banks, which have benefited from higher interest rates. Healey increased the surcharge on their profits from 3% to 6% but only for 15 months from January.
“Amid global economic storms, I am looking to our banks to help fund breathing space for British families,” he said.
Another revenue source will come from the gambling sector by increasing the machine games duty.
Healey said the British economy has been more resilient than anticipated this year and will grow by 1.2% in 2026, more than previously predicted.
However, he says inflation is higher than predicted earlier this year and likely to remain so for the coming year or two.
Inflation in the U.K. has risen to a near one-year high of 3.5% and is expected to rise further in the coming months. As a result, the Bank of England (BoE) is expected to raise interest rates soon, which will further raise the costs to the government of servicing its debt.
Low-key budget
Outside of the energy price support, Healey’s overall budget was low-key, especially at a time when bond markets are fretting over debt levels around the world. France has been in the spotlight recently following a wave of protests that have exposed the parlous state of its finances.
The main problem facing Healey is the same as that which confronted his predecessor Rachel Reeves, who was chancellor after Labour returned to power in a landslide election victory – the country’s debt mountain.
Even though the trajectory of the public finances was recently given a nod of approval from the International Monetary Fund (IMF), the U.K.’s debt has passed 3 trillion pounds for the first time ever, requiring 8% of government spending to service it.
Healey said that in forecasts provided by the independent Office for Budget Responsibility, the U.K. will spend 14 billion pounds more on debt interest this year.
“Those are the storms we face,” he said. “We can’t wish them away.”
Online marketplaces to collect tax from sellers
Healey also said on Wednesday he would make online marketplaces responsible for collecting value added tax (VAT) owed by retailers selling on their platforms.
“I will strengthen the requirements for online marketplaces so that sellers cannot avoid paying VAT when they sell online,” Healey said in his budget speech to parliament.
The change means that online marketplaces, such as Amazon, eBay, Temu, Shein and Alibaba, will become responsible for collecting the VAT which is charged on sales by sellers on their sites.
The finance ministry said the change, to be implemented from October 2027, is designed to tackle VAT evasion and support competition by helping ensure businesses that pay the tax they owe are not undercut by those that do not.
The rules will apply to U.K. businesses that are VAT registered or make sales of more than 90,000 pounds on an individual online marketplace.
German chemicals giant BASF lifted its 2026 profit outlook for the second time this year on Wednesday as it hiked prices to clients following the outbreak of the Iran war.
The maker of products ranging from automotive paints to sunscreen ingredients now expects a core profit of 7.4 billion to 7.8 billion euros ($8.2 to $8.7 billion) this year, up from a previous forecast of 6.9 billion to 7.7 billion euros.
BASF’s earnings have been boosted after it hiked prices for some goods in March by up to 30% in response to surging costs for energy and other raw materials because of the U.S.-Israeli war against Iran.
The company said Wednesday that its core profit in the third quarter rose 15% from the period last year to 1.6 billion euros.
Overall sales were up 14% over the period at 16.4 billion euros.
“The increase was mainly driven by considerably higher prices (plus 12%) and slightly higher volumes (plus 2%),” the company said in a statement.
The results come as the European chemicals industry is under major pressure from high energy prices and increasingly intense competition from Asian rivals.
BASF is undertaking a major restructuring, cutting thousands of jobs at its historic German headquarters in Ludwigshafen after opening earlier this year a major chemical complex in China to serve Asian markets.
The company is also exploring the multibillion-euro acquisition of its German rival Evonik, saying the combination could let it obtain feedstocks and precursor chemicals at lower cost.
“This is a serious attempt,” chief executive Markus Kamieth told a press conference about the proposed merger.
“We’re committed; this is certainly not something that is going to drag on for years,” he said.
Turkish authorities set Oct. 30 as the date to begin interim payments in the funds undergoing “extraordinary” liquidation as part of the ongoing process affecting dozens of funds following the launch of an investigation last month.
Vice President Cevdet Yılmaz said on Tuesday, while speaking in front of the parliamentary Plan and Budget Commission, that the payments would commence as of Friday following the national holiday on Thursday.
“As of Friday, I can say that the payments will begin. As part of the extraordinary liquidation, payments up to TL 1 million will begin as of Friday, through Işbank and Ziraat Bank,” he said.
Authorities announced a series of measures since the middle of September to shore up market stability after some investment funds defaulted on redemption requests, triggering a sharp sell-off in Türkiye’s benchmark stock index.
They announced the liquidation of 131 funds managed by seven companies. The liquidation process has been split into ordinary and extraordinary procedures.
The vice president said that the payouts in the ordinary process “have been largely completed.”
“Payments will be made starting from the lowest amount, moving to higher amounts. These payments will be covered from three sources: the remaining balances in the funds, voluntary returns, and resources that can be quickly converted into cash. We expect that the payments to be made with these sources will be completed within 1-2 weeks, by mid-November,” Yılmaz said.
“We are making every effort to ensure that the relevant institutions make the payments as quickly as possible. I can say that a significant amount will be paid on Friday,” he added.
The Capital Markets Board (SPK) said earlier this week that it has decided to temporarily suspend the capital markets activities of Tera Portföy and Pusula Portföy and appoint banks to carry out the liquidation of funds established by the companies.
These companies were among those at the center of the investigation that was launched after a sell-off in September.
On Wednesday, the eighth meeting of a special fund coordination board established following the market turmoil was also held under the chairmanship of Yılmaz, the Directorate of Communications said in a written statement.
The meeting was attended by representatives from the Justice Ministry, the Treasury and Finance Ministry, and the relevant institutions and organizations affiliated with these ministries, the directorate said.
It also said that since the beginning, “the number of funds in liquidation has decreased from 131 to 38, and a total of TL 68 billion in-kind and cash liquidation payments have been made to 71,899 accounts.”
The statement also confirmed that interim payments in the funds included in the extraordinary liquidation process are expected to begin on Friday, Oct. 30, 2026.
Close to half a million investors were impacted in the case.
Türkiye’s foreign trade deficit narrowed in September compared to the same month last year as exports grew much faster than imports, official data shared by the Turkish Statistical Institute (TurkStat) showed on Wednesday.
The trade deficit dropped to $5.16 billion in September from $6.96 billion a year ago, the data revealed.
This marked a 25.8% decrease compared with September 2025.
In September, exports jumped by 15.3% on an annual basis to nearly $26 billion, while imports rose only by 5.6% to $31.1 billion.
Excluding energy products and non-monetary gold, the foreign trade shortfall was $541 million, TurkStat said.
Türkiye’s main partner country for exports during September was Germany, followed by the U.S., the U.K., Iraq and Italy. The country imported more from China, followed by Germany, the U.S. and Italy.
In the January- September period this year, exports stood at nearly $211 billion, with a 5.2% increase, and imports were $281.9 billion, up 5.3% year-over-year, respectively.
Shares of billionaire Mukesh Ambani’s Reliance Jio Platforms climbed as much as 21% at the start of trading on the Mumbai stock exchange on Wednesday, making it India’s second-largest company by market capitalization, valued at about $131.5 billion.
The listing, the first for the Reliance conglomerate in two decades, furthers Ambani’s plan to turn Reliance from an oil-and-chemicals conglomerate into an “everything company” spanning consumer products and technology.
Jio, whose telecoms business serves more than 530 million customers, is backed by Meta Platforms and Alphabet’s Google. Its user numbers are second only to China Mobile on the basis of single-country subscribers.
The listing ceremony on Wednesday in Mumbai was attended by members of the Ambani family, including Mukesh’s eldest son, Akash, who is Jio’s managing director. Before walking to the stage to speak, he touched his parents’ feet, a traditional gesture of respect.
While all three children of the senior Ambani gave speeches, Mukesh sat in the audience, visibly emotional and in tears.
Mukesh Ambani, Asia’s richest person according to Forbes magazine, has spent years shaping a succession plan that was intended to avoid a repeat of the public feud with his younger brother, Anil, that followed their father Dhirubhai’s death in 2002 without a will.
To celebrate the listing, Reliance is hosting a celebration for employees at its large office near Mumbai, with jam sessions and other performances planned, an internal memo showed.
Jio’s stock opened at 1,358 rupees a share, compared with its 1,119-rupee offer price. Its market capitalization overtook those of telecom firm Bharti Airtel and HDFC Bank, making it the second-largest Indian firm by that metric.
“The IPO price offered a valuation entry point; the listing price reflects a much greater degree of optimism,” said Aishvarya Dadheech, founder of Fident Asset Management.
‘Thank you, India’
Several brokerages see a potential upside for the Jio stock, but they flagged competition, heavy capital spending and changes in India’s telecom rules, including those related to spectrum, licensing and fees.
“Jio has had a strong debut even despite geopolitical issues and turbulent market conditions … the revenues and earnings will lead the stock here onwards,” said Kranthi Bathini, equity strategist at WealthMills Securities.
The Ambani family rang the IPO bell on stage at the National Stock Exchange in Mumbai. Mukesh Ambani watched as Anant traced Reliance’s and Jio’s legacies and journey in a speech at the ceremony.
Major Indian newspapers on Wednesday carried front-page ads from Reliance Jio, saying, “Thank you, India.”
India has become the world’s busiest IPO market this year in terms of the number of deals, with 246 listings so far, though it ranked fourth by money raised at $13.5 billion, behind the US, mainland China and Hong Kong, LSEG data showed.
Including Jio Platforms’ record IPO would lift India above Hong Kong’s $15.4 billion, according to Reuters calculations.
Despite its size, Jio Platforms’ IPO was not a record payday for its bankers. Its 19 bankers will split about $20.7 million, or 0.65% of the offer, roughly half the 1.3% that sources said Hyundai Motor India paid to its bankers in 2024.
Wealth generator
The Jio listing is the Ambanis’ latest turn at the stock market. Dhirubhai Ambani, Mukesh’s father and Reliance’s founder, took the company public in 1977 with an offering aimed at small retail investors, which was widely credited with helping build India’s equity culture.
Jio comes from a stable that Indian investors have long backed: parent Reliance Industries has returned about 900% since 2006, ahead of the Nifty’s 685%, LSEG data shows, and is often seen as a buy-and-hold staple in retail portfolios.
After the ceremony, people waved flags bearing the Jio logo next to the National Stock Exchange’s bull statue, where the Ambani family posed for pictures.
-
Politics2 days agoFrance reportedly mulls postponing Med grid after Türkiye-Libya deal
-
Politics2 days agoYemen hails strong ties with Türkiye, its role in region
-
Economy2 days agoReady for French test?: 5 questions for European Central Bank
-
Politics2 days agoTurkish opposition parties’ cash row grows
-
Politics2 days agoTurkish Parliament set to debate Mecca deal bill
-
Economy2 days agoTürkiye begins production of $300M K9 light commercial vehicle project
-
Sports2 days agoFootball-mad Türkiye in love with Salah after Trabzonspor heroics
-
Politics2 days agoUzbek leader instrumental in new era of cooperation in Central Asia