WASHINGTON (AP) — The Federal Reserve raised its benchmark interest rate Wednesday for the first time since 2023 in an effort to quell stubbornly high inflation, and the central bank signaled another rate hike could occur later this year.

The quarter-point increase lifts the Fed’s key rate to about 3.9% and, over time, could result in higher borrowing costs for mortgages, auto loans and credit cards. In a set of quarterly projections, the Fed also signaled its rate-setting committee could raise it a second time to 4.1%.

The move comes as Americans are already struggling with high costs for groceries, gas and housing. Affordability has taken on a leading role in the upcoming midterm elections, just seven weeks away.

It adds another potentially dicey economic variable for Republicans and President Donald Trump, who blasted the decision Wednesday and accused the Fed’s top policymakers of trying to hurt him politically.

Chair Kevin Warsh, who was nominated by Trump, emphasized after the announcement that the economy has shown signs of gathering speed since the central bank decided to keep rates unchanged in late July. Inflation has also remained stubbornly above the Fed’s 2% target, and he noted there is little sign it is cooling.

“The plain fact is that inflation is too high and has been for too long,” Warsh said. “We must be confident that underlying inflation is moving to our objective clearly and at sufficient speed. Today the FOMC decided that this standard has not been satisfied,” he added, referring to the policy-setting Federal Open Market Committee, an arm of the Fed.

“Warsh’s tough talk around inflation in the post-meeting press conference suggested that he may be pushing for higher rates in meetings to come,” said Preston Caldwell, chief U.S. economist at Morningstar.

Warsh also said renewed combat between the U.S. and Iran, which has driven up gas prices, had convinced Fed officials to support rate hikes.

“There’s no hiding from hot spots around the world,” he said.

The president lashed out at ‘a bunch of politicians’

Trump, speaking to reporters in North Carolina ahead of a midterm campaign rally, made no mention of his policies that influenced the decision, instead framing the historically independent Fed as another political actor in Washington.

“The board is very hostile. They’re very political. They’re doing the wrong thing. They’re a bunch of politicians,” he said, adding, “They’re raising rates to make Trump do as bad as they can possibly do.”

Warsh noted that other central banks are hiking interest rates in response to global turmoil and higher gas prices. The European Central Bank raised its key rate last week, and the Bank of Japan is expected to do the same Sept. 18.

The Fed next meets in late October and most economists expect officials will keep rates unchanged then because it is just a week before the midterm elections. But Wall Street analysts now see a rate hike by December as a near certainty, according to futures prices.

Also late Wednesday, the yield, or interest rate, on the 2-year Treasury rose to 4.74% from 4.67%, another sign investors expect the Fed to potentially lift rates further. Still, if inflation does show signs of cooling in the coming months, that could change.

Since taking the lead at the Fed in May, Warsh has said it is firmly committed to taming inflation, and policymakers would take their cues from the data to determine if inflation was going in the right direction.

The rate hike marks a turnaround for Warsh. He often suggested last year when under consideration by Trump that the Fed could reduce its key rate, echoing the president’s call for lower borrowing costs.

In April, when Warsh’s nomination was under consideration by the Senate Banking Committee, Trump said in a television interview that he would be disappointed if Warsh didn’t cut rates. On the same day, however, Warsh told the committee he did not promise Trump he would cut rates and said he would be “an independent actor” as Fed chair.

Trump said in North Carolina that he had talked to Warsh ahead of the vote and told him, “You might as well vote with the board because it’s not going to matter.”

The fallout from Trump’s war remains a factor

The ongoing disruptions from the Iran war, which have pushed up average gas prices more than 7% from just a month ago, threaten to spread through the economy and keep broader inflation stubbornly high. An inflation report last week showed core prices, which exclude food and energy, accelerated a bit in August.

According to the Fed’s preferred measure, inflation was 3.7% in July compared with a year ago, up from 2.3% in April 2025, just before Trump unveiled sweeping tariffs. Core inflation, which excludes the volatile food and energy categories, was 3.3% in July, the latest data available, up from 3% just before the Iran war and far above the Fed’s target.

Fed policymakers unanimously supported the rate hike, compared with late July when the central bank kept rates steady and three officials dissented in favor of higher rates. Sixteen of the 18 Fed policymakers who submitted growth and interest rate projections penciled in at least one further rate hike this year, with four supporting two more increases.

Earlier Wednesday, the government said retail sales jumped 1.2% in August from the previous month, a sign that consumers are still spending at healthy levels despite sentiment surveys that indicate Americans remain gloomy about the economy. Strong spending is a sign that interest rates at current levels aren’t necessarily restricting the economy and cooling inflation.

“While uncertainty remains elevated owing, in part, to geopolitical developments, domestic spending has been resilient,” the Fed said, a likely reference to ongoing consumer spending and strong investment in artificial intelligence data centers by large technology companies.

Higher inflation isn’t all about gas prices. Ongoing investment in AI has driven up prices for computer chips and other electronic gear, adding to overall inflation. Tariffs may still be elevating some costs, such as appliances, which jumped in price last month.

Warsh isn’t the first Fed chairman caught in Trump’s politics

Trump had harshly criticized Warsh’s predecessor, Jerome Powell, for not cutting rates quickly enough. His Justice Department even launched a criminal investigation into Powell over brief testimony he delivered to Congress last year, though that probe was eventually dropped.

When asked Wednesday how the president might react to the rate increase, Warsh said, “I’ve got nothing for you on a discussion with the president.”

On Sunday, Kevin Hassett, Trump’s top economic adviser, was asked in an interview with Fox News how Trump might react to a rate hike.

“I’m sure he’s not going to be super happy about it, but he will defend the independence of Kevin Warsh above all,” Hassett said.

Warsh might have a measure of protection from the fact that his father-in-law Ronald Lauder is a friend of Trump’s and a billionaire donor to his campaigns.

And the president, for all his complaints, insisted he wants Warsh “to be independent.” Asked explicitly whether he still has confidence in Warsh, Trump replied, “I do.”

LOS ANGELES (AP) — Hollywood filmmaker Rob Reiner ‘s son will not face the death penalty on charges he fatally stabbed his parents after lying in wait at their home in Los Angeles late last year, prosecutors said Tuesday.

If convicted, the maximum sentence 33-year-old Nick Reiner could get is life without the possibility of parole, Los Angeles County District Attorney Nathan Hochman said at a news conference. Before reaching its decision, Hochman said his office did a thorough review, including speaking to Rob and Michele Singer Reiner’s families and evaluating mitigating factors in Nick Reiner’s favor.

Nick Reiner, who briefly appeared at a court hearing Tuesday morning, has twice pleaded not guilty. The death penalty had been on the table because of the lying-in-wait allegation, the fact that multiple people were killed, and the use of a knife, which is considered a dangerous weapon. However, it’s been two decades since California’s last execution, and Democratic Gov. Gavin Newsom declared a moratorium on the practice in 2019.

Nick Reiner’s public defender highlights his mental illness

Reiner’s attorney, Deputy Public Defender Kimberly Greene, said prosecutors made the right decision.

“Nick has a serious mental illness and a long history of struggling with self-medication. His circumstances are a tragic example of how difficult it can be for people experiencing significant mental health challenges to access and navigate the treatment and support they need,” Greene said in a statement. “Nothing can undo the profound loss experienced by the Reiner family and those who loved them. Our hearts remain with the family.”

Nick Reiner was charged with first-degree murder on Dec. 16, two days after the stunning killings. Reiner’s former defense attorney, Alan Jackson, adamantly insisted that “pursuant to the laws of California, Nick Reiner is not guilty of murder.”

Jackson had to withdraw for undisclosed reasons that he said were beyond his and the client’s control, and a public defender took over for him.

A grand jury indicted Reiner in July. The judge in the case was deciding whether to make public the transcripts of those secret grand jury proceedings, a move that would likely reveal many key details about the killings.

Hochman said his office will not oppose the transcripts’ release, but Nick Reiner’s siblings Jake and Romi Reiner were adamantly opposed, saying it would add to their trauma and harm.

At Tuesday’s hearing, Judge Sam Ohta said he will hear arguments on the issue next month.

Nick Reiner wants access to his trust fund

Reiner has asked a different judge to force the release of money from a trust his parents set up for him when he was a child, so that he can rehire Jackson, a high-profile defense attorney whose clients have included Kevin Spacey and Karen Read.

The trustees overseeing the funds argue Reiner shouldn’t get them, but his lawyers argue that he is still innocent under the law and that the money would legally be his regardless of his parents’ deaths. Reiner is awaiting a ruling on the money. Jackson has said he wants to return to the case.

Hochman said he does not expect a trial until next year.

Hours earlier, Rob Reiner was honored at the Emmys

Rob Reiner received an emotional tribute at the Emmy Awards on Monday night. He won a posthumous Emmy for best guest actor in a comedy series for his role on “The Bear,” and was honored by his friend and “Bear” co-star Jamie Lee Curtis.

“He was generous, kind and funny as hell, and a friend to all,” Curtis said. “And we all miss Rob and Michele and all those we lost this year.”

Nick Reiner was the second of Rob and Michele Reiner’s three children. He and his father co-wrote the script for the 2015 film “Being Charlie,” which was partly based on the son’s teenage struggles with addiction and homelessness.

Rob Reiner began as an actor, starring in the TV sitcom “All in the Family” as Michael “Meathead” Stivic, the liberal son-in-law to a much more conservative and bigoted Archie Bunker, played by Carroll O’Connor. Reiner won two Emmy Awards for the role.

He became a prolific director whose work included some of the most memorable and endlessly watchable movies of the 1980s and ’90s. His credits included “This is Spinal Tap,” “Stand By Me,” “A Few Good Men,” and “When Harry Met Sally…” during the production of which he met photographer Michele Singer. They wed soon after and were married for 36 years.

WASHINGTON (AP) — President Donald Trump on Monday lashed out against concerns about rogue artificial intelligence, claiming that any efforts to limit the technology are part of a “SICK conspiracy.”

“AI taking over the World, destroying Humanity, and all other things bad, is a HOAX,” Trump posted on social media, later suggesting that those calling for guardrails on the technology had also warned about climate change, which he also called a hoax.

The president was pushing back against calls by tech leaders such as Anthropic’s Dario Amodei, OpenAI’s Sam Altman and SpaceXAI’s Elon Musk to have greater government oversight of AI. The rapidly evolving technology has become a source of controversy after a series of hacks in recent months that showed AI agents can conspire to deceive humans.

Many tech leaders generally say their goal is to develop the technology in ways that promote safety, address legal liability, feed economic growth, advance science and preserve national security. But they have also expressed concerns that an AI unshackled from human control could be destructive — a claim Trump rejected in a series of heated social media posts as he claimed to be the “Hoax Buster.”

Trump maintained that his presence in the Oval Office should assuage any fears about AI.

“The only control or ‘guardrails’ that AI needs is a STRONG AND SMART (High IQ!) PRESIDENT, and the U.S.A. has that, in spades!” Trump posted.

Trump specifically said his administration has already stopped the AI company Anthropic “from doing bad, or potentially bad” things. Anthropic has endured an uncomfortable relationship with the Trump administration, with the Pentagon trying to label the company a security risk and the government issuing a temporary ban of one of its more advanced models.

The president also criticized the business acumen of the tech CEOs seeking government oversight, posting on social media, “when, in the History of Business, did anyone see the Leaders of an Industry call for Regulation that, if strongly implemented, will drive them into oblivion and bankruptcy?”

Trump’s refusal to regulate comes as AI execs warn of threats

Amodei, the Anthropic CEO, published a 3,800-word essay Saturday that called for slower development of AI. Microsoft on Monday published its own code of conduct to ensure that humans control AI. The actions come after a series of warnings by AI experts about the technologies’ capabilities and the July 2026 cyberattack by OpenAI models on the AI company Hugging Face.

Amodei cited “AI’s growing ability to build the next generation of AI” and the cyberattack by the swarm of OpenAI agents as reasons to slow the pace of development.

“Given the accelerating rate of AI capability development, it’s my worry that in 6–12 months such a swarm could be capable of taking over the entire internet,” Amodei wrote, adding that the damages could be in the hundreds of billions of dollars or more “without the necessary guardrails.”

Altman of OpenAI seconded that perspective in a weekend post on social media.

“Pacing will be well worth this cost; no amount of American competitive pressure should justify recklessness, or let capabilities get ahead of alignment and monitoring,” Altman said. “Where we will need the help of our government is for international coordination.”

Trump and Altman did meet last week on the sidelines of the Republican midterm convention in Dallas, according to a person familiar who insisted on anonymity to discuss a private meeting. The person stressed that Altman regularly talks with lawmakers in both parties.

Trump does have some support from Nvidia CEO Jensen Huang, who has described the risks of AI as overblown. The president phoned the co-founder of the chipmaker on Monday during an interview Huang was having for a podcast. Huang put the president on speaker and they agreed there was excessive alarmism about AI, according to social media posts and videos.

Trump sees AI regulation as helping China

The president has opposed such efforts to constrain AI and claims that doing so could cause China to eclipse America on the technology.

“There is a SICK conspiracy going on against AI and Data Centers, and the only one that is happy about it is China,” Trump said.

The president has long resisted efforts for greater government oversight of AI, embracing his philosophy going back to 2016 of “I alone can fix it.” He returned to the White House last year by revoking a Biden administration executive order on AI oversight and only provided a fuller order of his own more than 16 months later this past June.

The prospect of slower AI buildout led stocks to slip in Monday morning trading, as demand for advanced computer chips and construction materials for data centers could fall. But Trump’s frustration comes as AI has also emerged as a political liability ahead of November’s midterm elections, with many voters opposing the construction of additional data centers and expressing worries that AI could lead to job losses and undermine the education of children.

House Speaker Mike Johnson, R-La., told reporters Monday that he expects Trump will have the AI companies potentially meet at the White House this week or next week, saying that the sit-down has yet to be scheduled.

“There will be a deliberate discussion about the responsibility of the companies to maintain safety, and what role, if any, the government has to play in that,” said Johnson, adding that legislatures can tend to respond problematically with “red tape and hyper regulation” and that the loss of competitive edge on AI would be a national security concern.

Trump’s handling of AI is a midterm issue

Many Democratic lawmakers and candidates see the need to regulate AI, heeding not just the issues raised by companies but the risks of job losses, rising inequality and higher electricity bills. Trump’s refusal to address the risks has given them a political opening going into the November midterm elections.

“It’s very real, despite what Donald Trump has to say,” House Democratic Leader Hakeem Jeffries of New York said at the Capitol. “We need to act now.”

Rahm Emanuel, the former Chicago mayor, Democratic congressman and White House chief of staff, said in a social media post that Amodei’s essay was “an admission that we’re driving down a dark, winding road on wet pavement with the headlights off. And where’s President Trump? Looks like he nodded off again.”

But the administration has repeatedly sought to minimize the risks being highlighted by AI companies.

Trump in a separate Monday social media post said the concerns about AI are only because “the United States is leading, by a lot, every other country. Don’t kill the Golden Goose!” The AI buildout has accounted for a large share of the economic growth during Trump’s second term and the administration has bet that the technology will fuel additional productivity gains.

Vice President JD Vance told reporters Monday morning about AI, “I don’t think Americans should be scared of anything.”

Vance, speaking as he prepared to fly to Kansas for a midterm election campaign event, said the Trump administration is concerned about AI but wants to make sure it is regulating the technology smartly, warning that the U.S. is in an AI arms race against China.

“Personally, I feel a little bit weird about the fact that you have so many frontier AI tech companies kind of coming to the government and begging the government to regulate them. It feels a little bit to me like a bit of a Trojan horse,” Vance said. “So, I think we just have to be careful about this.”