Fed Signals Another Rate Hike as Gulf Storm Threatens U.S., FBI Disrupts Mall Attack and Russia Pounds Ukraine

Fed Sees Inflation Risks Persisting as Treasury Yields Climb

Federal Reserve officials broadly agreed that inflation remains high enough to warrant restrictive monetary policy and indicated that another rate increase will probably be appropriate this year, according to minutes released Wednesday from the central bank’s September meeting.

The Fed unanimously raised its benchmark federal funds rate by a quarter percentage point last month, to a range of 3.75% to 4%, its first increase since July 2023. The minutes showed more disagreement beneath that unanimous vote: many policymakers characterized the increase as insurance against inflation remaining persistently above the Fed’s 2% target, while others considered higher rates necessary under their baseline economic forecasts. Almost all participants saw inflation risks tilted to the upside, while risks to employment had become more balanced. The Fed’s staff estimated that inflation remained above 3% in August, with tariff increases, higher energy costs and technology-related spending associated with the AI buildout contributing to price pressures.

Financial markets reflected those concerns Wednesday. The 10-year Treasury yield briefly approached 5.37%, its highest level since 2002, before easing later in the session. The Dow Jones Industrial Average closed about 0.7% lower, while the S&P 500 and Nasdaq Composite each slipped roughly 0.2% after recently reaching records. Brent crude remained around $100 a barrel amid continued Middle East supply concerns. Investors are now focused on whether policymakers act again at their late-October meeting or wait until December, when markets currently see a greater likelihood of another quarter-point increase.

Tropical Storm Isaias Takes Aim at the Northern Gulf Coast

Communities from Louisiana to Florida began preparing Wednesday for Tropical Storm Isaias, which formed over the Gulf of Mexico and is expected to strengthen into a hurricane before approaching the northern Gulf Coast on Friday.

The National Hurricane Center issued a hurricane watch from Bay St. Louis, Mississippi, to Indian Pass, Florida, along with a storm-surge watch stretching from the mouth of the Mississippi River to Yankeetown, Florida. Forecasters said rapid strengthening was expected as Isaias moved through warm Gulf waters, with the storm potentially becoming a major Category 3 hurricane before landfall. Florida Gov. Ron DeSantis declared a state of emergency covering 25 counties, while offshore oil and gas operators began curtailing some production.

The immediate danger extends well beyond damaging winds. Forecasters warned of potentially life-threatening storm surge along portions of the coast and projected 3 to 6 inches of rain from southeastern Louisiana through the Florida Panhandle, with isolated totals reaching 10 inches. Heavy rainfall could spread into the Tennessee Valley and Carolinas during the weekend, creating flash- and urban-flooding risks. Hurricane conditions could begin along parts of the coast late Friday, meaning preparations will need to be largely completed before then.

FBI Says It Disrupted ISIS-Inspired Mall of America Shooting Plot

Federal authorities charged an 18-year-old Minnesota man Wednesday with allegedly preparing an ISIS-inspired mass shooting at the Mall of America, saying an undercover operation ended the plot before the suspect obtained a functioning weapon.

Sheikhdoon Abdullahi Mohamud of Richfield was arrested Tuesday after paying about $600 to an undercover FBI employee for what he believed was an AK-47 rifle, four 30-round magazines and approximately 200 rounds of ammunition, according to the Justice Department. The FBI had rendered the rifle inoperable before the transaction. A federal criminal complaint charges Mohamud with knowingly receiving a firearm and ammunition to commit a federal terrorism offense. The allegations have not been proven, and Mohamud is presumed innocent.

Authorities said Mohamud had been communicating with a confidential source since December 2024 and initially discussed traveling overseas to join an extremist organization. Investigators allege that he later focused on carrying out an attack in Minnesota, eventually identifying the Mall of America and Oct. 24, when a Hmong arts celebration was scheduled there. Prosecutors said he discussed killing between 30 and 60 people and pledged allegiance to ISIS. The case, involving the FBI, Joint Terrorism Task Force and Bloomington police, now moves into federal court as investigators continue examining Mohamud’s communications and whether anyone else was involved.

Paramount-Warner Bros. Combination Creates a New Hollywood Giant

One of the largest consolidations in modern entertainment became reality as Paramount completed its acquisition of Warner Bros. Discovery, bringing an extraordinary collection of film studios, television networks, streaming platforms, news operations and sports rights under a company now known as Skydance.

The combined business includes Paramount Pictures and Warner Bros., streaming services Paramount+ and HBO Max, and networks and brands including CBS, CNN, HBO, TNT, MTV, Nickelodeon and Food Network. Its entertainment franchises range from “Top Gun,” “Star Trek” and “SpongeBob SquarePants” to Harry Potter, DC and “Game of Thrones.” The company says HBO Max and Paramount+ will remain separate initially but ultimately will be unified into a single streaming service. It has also committed to producing at least 30 theatrical films annually and more than 180 television programs and series.

The combination creates a formidable competitor to Netflix, Disney and other global entertainment companies but also raises questions about jobs, programming budgets and the future of theatrical filmmaking amid another wave of industry consolidation. Early leadership changes have already begun, while Skydance shares fell sharply Wednesday as investors assessed the debt and execution risks surrounding the enlarged company. The next major test will be whether management can combine the sprawling businesses without weakening the individual brands that made the merger valuable.

Russian Barrage Kills at Least 24 Across Ukraine

Russia launched one of its heaviest recent missile and drone attacks against Ukraine, killing at least 24 people and damaging homes, industrial facilities and energy infrastructure as Kyiv renewed calls for additional Western air-defense systems.

The deadliest strike hit Pryluky in the northern Chernihiv region, where Ukrainian officials said a missile destroyed part of a five-story apartment building, killing at least 18 people, including four children. Dozens were injured as rescuers searched the wreckage. Additional deaths were reported in Kyiv, Kremenchuk and Oleksandriia. Ukrainian President Volodymyr Zelenskyy said Russia fired about 70 missiles, including numerous ballistic weapons, along with waves of attack drones. The bombardment coincided with Russian President Vladimir Putin’s 74th birthday, a point highlighted by Ukrainian officials in condemning the attack.

The scale and composition of the barrage again exposed Ukraine’s shortage of defenses capable of intercepting ballistic missiles. Zelenskyy appealed to allies for additional U.S.-made Patriot systems and interceptors, describing strengthened air defense as an immediate necessity. The attack comes as the war continues to strain Ukrainian infrastructure and Western weapons inventories, while diplomatic efforts have yet to produce a durable path toward ending the conflict.

Looking Ahead

Attention Thursday will center on Isaias as forecasters determine how quickly the storm intensifies and where its strongest winds and storm surge are most likely to reach the Gulf Coast. Emergency declarations, evacuations and offshore energy shutdowns could expand as the forecast becomes more precise.

Markets will continue assessing the Fed’s rate path alongside elevated oil and Treasury yields, while federal prosecutors begin advancing the Mall of America terrorism case. Overseas, Ukraine’s demand for additional Patriot air defenses is likely to return to the forefront following Wednesday’s deadly Russian barrage, with the availability of interceptors becoming increasingly important as Moscow relies heavily on ballistic missiles and drones.