{"id":71876,"date":"2026-09-16T17:38:15","date_gmt":"2026-09-16T21:38:15","guid":{"rendered":"https:\/\/www2.stockmarketwatch.com\/stock-market-news\/fed-defies-trump-with-first-rate-hike-in-three-years-kim-yo-jong-rejects-iaea-denuclearization-talks\/71876\/"},"modified":"2026-09-16T17:38:15","modified_gmt":"2026-09-16T21:38:15","slug":"fed-defies-trump-with-first-rate-hike-in-three-years-kim-yo-jong-rejects-iaea-denuclearization-talks","status":"publish","type":"post","link":"https:\/\/www2.stockmarketwatch.com\/stock-market-news\/fed-defies-trump-with-first-rate-hike-in-three-years-kim-yo-jong-rejects-iaea-denuclearization-talks\/71876\/","title":{"rendered":"Fed Defies Trump with First Rate Hike in Three Years; Kim Yo Jong Rejects IAEA Denuclearization Talks"},"content":{"rendered":"<h2>Key Takeaways<\/h2>\n<ul>\n<li><strong>Federal Reserve Chair Kevin Warsh<\/strong> led a unanimous <strong>12-0 vote<\/strong> to raise the benchmark interest rate by <strong>25 basis points<\/strong> to a range of <strong>3.75%\u20134.00%<\/strong>, the first increase since 2023.<\/li>\n<li><strong>President Donald Trump<\/strong> immediately condemned the move, demanding that interest rates be slashed to <strong>1% or less<\/strong>, citing the U.S. as the &quot;best credit in the world.&quot;<\/li>\n<li><strong>North Korea\u2019s Kim Yo Jong<\/strong> dismissed the <strong>International Atomic Energy Agency (IAEA)<\/strong> general assembly&#39;s discussions on denuclearization as &quot;silly talk,&quot; reaffirming the nation&#39;s nuclear status as &quot;irreversible.&quot;<\/li>\n<li><strong>Inflation remains the primary catalyst<\/strong> for the Fed&#39;s hawkish shift, driven by soaring fuel prices linked to the ongoing <strong>U.S.-Iran conflict<\/strong> and supply chain pressures.<\/li>\n<\/ul>\n<h2>Fed Implements Surprise Hike Amid Political Pressure<\/h2>\n<p>The <strong>Federal Reserve<\/strong> ended a three-year hiatus on interest rate increases Wednesday, lifting the federal funds rate to a target range of <strong>3.75% to 4.00%<\/strong>. Led by Chair <strong>Kevin Warsh<\/strong>, the Federal Open Market Committee (FOMC) cited stubbornly high inflation\u2014currently tracking at <strong>3.7%<\/strong>\u2014as the primary driver for the tightening cycle. Warsh, a Trump appointee who assumed the role in May, emphasized that the central bank must remain &quot;in its lane&quot; and prioritize price stability over political demands.<\/p>\n<p>The move marks a significant pivot for the central bank, which as recently as March had projected rate cuts for 2026. However, the economic landscape has been complicated by the <strong>U.S.-Iran war<\/strong>, which has spiked energy costs, and massive investments in <strong>AI data centers<\/strong> that analysts say are contributing to structural inflation. The Fed&#39;s updated &quot;dot plot&quot; now suggests at least one more hike may be necessary before the end of the year.<\/p>\n<h2>Trump Demands Drastic Cuts to &quot;1% or Less&quot;<\/h2>\n<p>President <strong>Donald Trump<\/strong> took to Truth Social shortly after the announcement to blast the decision, calling for rates to be lowered &quot;AND FAST!&quot; Trump argued that the United States should enjoy the lowest borrowing costs globally, specifically targeting a rate of <strong>1% or less<\/strong>. He linked his monetary policy stance to trade, claiming that the U.S. &quot;loses&quot; <strong>$1.5 trillion<\/strong> annually through trade deficits, which he characterized as a &quot;fancy word for LOSS.&quot;<\/p>\n<p>The public rift between the White House and the Fed Chair creates a volatile backdrop for financial markets just seven weeks before the U.S. midterm elections. While the White House officially termed the hike &quot;unfortunate,&quot; Trump\u2019s personal rhetoric has intensified, pressuring the Fed to support an economy he describes as &quot;BOOMING with new investment.&quot;<\/p>\n<h2>Kim Yo Jong Rebuffs International Nuclear Pressure<\/h2>\n<p>In a separate geopolitical development, <strong>Kim Yo Jong<\/strong>, the influential sister of North Korean leader Kim Jong Un, issued a sharp rebuke of the <strong>IAEA<\/strong> General Assembly. She dismissed international calls for the denuclearization of the Korean Peninsula as &quot;familiar silly talk&quot; and &quot;anachronistic.&quot; The statement follows recent IAEA reports indicating the expansion of North Korea&#39;s <strong>Yongbyon<\/strong> nuclear complex, including a new <a href=\"https:\/\/stockmarketwatch.com\/metal\/uranium\" data-internallinksmanager029f6b8e52c=\"13\" title=\"Uranium\">uranium<\/a> enrichment facility capable of housing <strong>28 centrifuge cascades<\/strong>.<\/p>\n<p>Pyongyang\u2019s latest rhetoric underscores its commitment to maintaining its nuclear arsenal as a &quot;permanent&quot; fixture of its national defense. This hardening stance comes despite renewed diplomatic overtures from the Trump administration, which has expressed interest in reviving direct talks. Kim Yo Jong\u2019s comments suggest that the regime has no intention of negotiating away its nuclear capabilities, which it has now enshrined in its national constitution.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Key Takeaways Federal Reserve Chair Kevin Warsh led a unanimous 12-0 vote to raise the benchmark interest rate by 25 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