Key Takeaways
- Federal Reserve interest rate cut expectations have been significantly pulled back this week, introducing fresh economic uncertainty into the American economy.
- Donald Trump announced plans to sue the BBC for an estimated $1 billion to $5 billion over an edited speech, while also commenting on Saudi Arabia's potential F-35 purchases and entry into the Abraham Accords.
- Starbucks (SBUX) faces a boycott call from Zohran Mamdani amidst an ongoing worker strike, contrasting with strong demand for Apple's (AAPL) iPhone 17 in China.
- A significant corruption crisis, involving "bags of cash and a gold toilet," is reportedly engulfing Zelenskyy’s government in Ukraine, raising concerns among international partners.
The American economy received another dose of uncertainty this week as traders and economists pulled back expectations for Federal Reserve officials to cut interest rates. This shift comes after previous projections anticipated two or three rate cuts in 2025 following reductions in 2024. The Fed's policy for the remainder of 2025 is expected to be data-dependent, closely watching inflation and labor market metrics.
Former President Donald Trump made several notable statements, including his intent to sue the BBC for "anywhere between a billion and 5 billion dollars" over an edited speech, with the lawsuit expected "sometime next week." The BBC has reportedly prepared to apologize for the misleading edit but rejects the basis for a defamation claim.
In foreign policy, Trump expressed that the U.S. is "honoring Saudi Arabia, the Crown Prince." He also indicated that Saudi Arabia is interested in purchasing a significant number of F-35 jets and other fighter aircraft, a deal he is "looking at." Trump further stated his hope that Saudi Arabia will join the Abraham Accords "fairly shortly," aiming to normalize relations between Israel and Muslim-majority nations.
Regarding past controversies, Trump reiterated his denial of ever being on Jeffrey Epstein's island, while claiming that Bill Clinton "went there supposedly 28 times." He has also asked the Justice Department and the FBI to investigate Epstein's involvement and relationship with Bill Clinton and other prominent figures. Additionally, Trump stated he spoke to the Prime Ministers of Thailand and Cambodia, asserting that "they're doing great" and "I think they’re going to be fine" after mediating a ceasefire in a border dispute.
On the corporate front, Starbucks (SBUX) is facing calls for a boycott from New York Mayor-elect Zohran Mamdani among his 1 million social media followers. This action comes amid an ongoing worker strike, with Mamdani advocating for "No contract, no coffee." Conversely, Apple (AAPL) experienced a surge in demand in China, with crowds rushing its stores again after the iPhone 17 launch. Reports indicate that iPhone 17 sales in China rose 22% in the first month after launch, a significant rebound from the previous year.
Internationally, Ukraine's Zelenskyy government is grappling with a corruption crisis, described as involving "bags of cash and a gold toilet." This scandal, which includes allegations of embezzlement and kickbacks, is raising concerns among international partners and observers about its impact on Ukraine's global reputation and its war efforts.
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications.