(NEW YORK) — The Justice Department is seeking to unseal the exhibits shown to the federal grand juries in New York that indicted Jeffrey Epstein and his former companion Ghislaine Maxwell in addition to the transcripts of testimony, according to a court filing Friday.
Justice Department officials have conceded that much of what is in the transcripts is already publicly known, but the exhibits contain names that did not appear in the transcripts, the filing said.
The government is now trying to notify those individuals “to the extent their names appear in grand jury exhibits that were not publicly admitted at the Maxwell trial,” the filing said.
The Justice Department asked the court to give it until Aug. 14 to make the necessary notifications. The filing did not say how many individuals needed to be contacted.
The Trump administration has been seeking to release materials related to the investigation into Epstein, the wealthy financier and convicted sex offender who died by suicide in jail in 2019, following the blowback it received from MAGA supporters after it announced last month that no additional files would be released.
Attorneys for victims of Epstein and Maxwell have criticized the administration’s approach to transparency, saying in a letter to the court that it “reinforces the perception that the victims are, at best, an afterthought to the current administration.”
The victims say they are generally supportive of transparency, but that they want the chance to review the records and propose additional redactions.
Maxwell, a longtime associate of Epstein, is currently serving a 20-year prison sentence for sex trafficking and other offenses in connection with Epstein.
(NEW YORK) — Prosecutors in the state case against Luigi Mangione denied on Friday violating the medical privacy rights of the accused UnitedHealthcare CEO killer, as his attorneys alleged, arguing they sought nothing more than “entirely unremarkable” information from his health insurer.
The defense accused prosecutors with the Manhattan District Attorney’s Office of violating Mangione’s rights protected under the Health Insurance Portability and Accountability Act when they subpoenaed Aetna for information and “partially reviewed confidential, private, protected documents.” The defense sought to suppress the information.
The district attorney’s office said in a filing on Friday that there was nothing “secretive or nefarious” about a subpoena that sought “entirely unremarkable” information like Mangione’s account number and time period of coverage.
In response, Aetna turned over more information than prosecutors requested, prosecutors said.
“Given these circumstances, defendant’s real complaint is not about the subpoena itself, but about Aetna’s response to the subpoena, which included documents that the People had not requested,” Assistant District Attorney Joel Seidemann said. “The People issued a valid subpoena to Aetna for an appropriately limited set of relevant information. Through no fault of the People, Aetna seemingly provided materials outside the scope of the subpoena. The People then properly identified the error and notified the Court and the defense and deleted our copy of said materials.”
The defense compounded Aetna’s mistake by sending prosecutors an email attaching the entire Aetna file that prosecutors had already deleted, Seidemann said.
“The defense nonetheless seeks to punish the People for the administrative mistakes of others, claiming that the People have perpetrated a ‘lie and a fraud’ against defendant — an inflammatory and dubious accusation without any basis,” Seidemann said.
Prosecutors urged the judge to grant no relief to Mangione and instead set a date for trial.
Mangione has pleaded not guilty to state charges alleging he murdered United Healthcare CEO Brian Thompson outside the Midtown hotel where the executive was about to attend an investor conference last year. Mangione has also pleaded not guilty to federal charges that could result in the death penalty.
A prison officer guards a cell at maximum security penitentiary CECOT (Center for the Compulsory Housing of Terrorism) on April 4, 2025 in Tecoluca, San Vicente, El Salvador./ Photo by Alex Peña/Getty Images
(NEW YORK) — A federal appeals court on Friday overturned U.S. District Judge James Boasberg’s attempt to initiate contempt proceedings against the Trump administration related to the March deportation of hundreds of migrants to El Salvador, in what the panel’s majority described as an “extraordinary, ongoing confrontation between the Executive and Judicial Branches.”
In a 2-1 decision, Judges Gregory Katsas and Neomi Rao — both Trump appointees — vacated Judge Boasberg’s contempt-related order that sought to determine if members of the Trump administration deliberately defied a court order after the president invoked the Alien Enemies Act in March.
“The district court’s order raises troubling questions about judicial control over core executive functions like the conduct of foreign policy and the prosecution of criminal offenses. And it implicates an unsettled issue whether the judiciary may impose criminal contempt for violating injunctions entered without jurisdiction,” Judge Katsas wrote in a concurring opinion.
The Trump administration invoked the Alien Enemies Act — an 18th century wartime authority used to remove noncitizens with little-to-no due process — to deport two planeloads of alleged migrant gang members to the CECOT mega-prison in El Salvador by arguing that the Venezuelan gang Tren de Aragua is a “hybrid criminal state” that is invading the United States.
Boasberg issued a temporary restraining order and ordered that the planes be turned around, but Justice Department attorneys said his oral instructions directing the flight to be returned were defective, and the deportations proceeded as planned.
Boasberg subsequently sought contempt proceedings against the government for deliberately defying his order.
Judge Katsas, in Friday’s decision, wrote that the “ambiguities” in Judge Boasberg’s original order blocking the removal of the migrants make it impossible to definitively say that the Trump administration acted in contempt.
“At the time of the alleged contempt, just hours after the TRO hearing and before any transcript of it was available, the district court’s minute order could reasonably have been read either way. Thus, the TRO cannot support a criminal-contempt conviction here,” he wrote.
In a searing dissent, Judge Cornelia Pillard defended Judge Boasberg’s attempt to initiate contempt proceedings to “vindicate the authority of the court” after the “apparently contumacious conduct.” 71045364″The rule of law depends on obedience to judicial orders,” she wrote. ” Yet, shortly after the district court granted plaintiffs’ emergency motion for a temporary restraining order, defendants appear to have disobeyed it. Our system of courts cannot long endure if disappointed litigants defy court orders with impunity rather than legally challenge them. That is why willful disobedience of a court order is punishable as criminal contempt.”
Attorney General Pam Bondi celebrated Friday’s ruling on social media, calling Judge Boasberg’s order “failed judicial overreach at its worst.”
“Our @TheJusticeDept attorneys just secured a MAJOR victory defending President Trump’s use of the Alien Enemies Act to deport illegal alien terrorists. The D.C. Circuit Court of Appeals affirmed what we’ve argued for months: Judge Boasberg’s attempt to sanction the government for deporting criminal-alien terrorists was a “clear abuse of discretion,” Bondi wrote. “We will continue fighting and WINNING in court for President Trump’s agenda to keep America Safe!”
U.S. Congressional District maps are displayed as the Senate Special Committee on Congressional Redistricting meets to hear invited testimony on Congressional plan C2308 at the Texas State Capitol on August 6, 2025 in Austin, Texas. Brandon Bell/Getty Images
(AUSTIN, Texas) — Texas Democrats on Friday are gearing up for another day defying Republican Gov. Greg Abbott and the state GOP as they try to move forward with controversial redistricting.
The Texas House is set to meet as Republican legislators say that Friday is the deadline for Democratic legislators who’ve fled the state to return or face consequences.
House Republicans will try to vote on GOP-proposed new congressional maps that would give Republicans more seats in Congress — potentially allowing the GOP to keep control of the U.S. House of Representatives in Washington.
Abbott has also requested the Texas Supreme Court to remove Democratic state Rep. Gene Wu, the Texas House minority leader, from office over the Democrats’ defiance. The court gave Wu until 6 p.m. ET Friday to respond to the governor’s case.
Wu told ABC News Thursday that he believes his caucus will hold out on Friday and once again deny the legislature a quorum, though he said they would be willing to come back to Austin if state Republicans promise to focus solely on other issues before the special session, including flood mitigation and disaster preparedness.
Democrats who have fled the state appear likely to stay away until Aug. 19, the end of the special session, meaning there will be not be enough lawmakers present for the Texas House to conduct business.
Texas Attorney General Ken Paxton told Fox News on Friday that he is willing to take other Democrats to court if they don’t return.
“If they show up today, we’re all happy, we can get our business done, and everybody is good. If they do not show up, we will be in an Illinois courtroom … [trying] to get them back to the state of Texas, hold them in contempt, and if they refuse to come, hopefully put them in jail,” he said.
He shrugged off concerns that the optics of arresting Democrats would give them a public opinion win.
“I think in Texas — I don’t know what it’s like in other states, but I do know in Texas, people expect their representatives to go to work,” Paxton said.
Texas House Speaker Dustin Burrows targeted the wallets of the absent members in an effort to draw them back.
On Thursday, he sent a memo to all members and their staff requiring that any member who is absent from the special session to break quorum must collect their monthly check in person. Direct deposits were suspended for those skipping out until the House reaches quorum, according to memo.
Abbott has called for the Democrats’ arrest, and Republican Sen. John Cornyn has called on the FBI to track down those elected officials.
The governor said in a podcast released Friday that he was willing to go further than creating more than five new seats the GOP could flip if the Democrats continued to block.
“We may make it six or seven or eight new seats we’re going to be adding on the Republican side,” he said during an interview on the podcast “Ruthless.”
In the meantime, the Texas Democrats have fled to various blue states, including Illinois and California.
California Democratic Gov. Gavin Newsom is slated to hold a news conference with those Democrats Friday afternoon, along with Rep. Nancy Pelosi and California state Democrats to show their support.
“The governor and state leaders have floated a potential statewide ballot measure that would reaffirm California’s commitment to national independent redistricting and allow voters to temporarily adjust the state’s congressional map only if Texas or other GOP-led states manipulate theirs,” Newsom’s office said in a statement.
California Democrats are preparing to respond to Texas Republicans’ proposed new congressional districts by possibly targeting five GOP-held districts in the Golden State, sources recently confirmed to ABC station KGO-TV. But the office of the California Secretary of State told ABC News that if legislators don’t move fast, it becomes nearly impossible for the state to run a statewide election that meets federal standards.
ABC station KGO-TV’s Monica Madden contributed to this report.
NY Attorney General Letitia James hosts a town hall at SUNY Westchester Community College to hear from residents about the impact of former President Donald Trump’s policies on their lives on May 08, 2025 in Valhalla, New York/ (Photo by Spencer Platt/Getty Images)
(NEW YORK) — Federal prosecutors in Albany have issued subpoenas to New York Attorney General Letitia James inquiring about her office’s civil fraud case against President Donald Trump and corruption case against the National Rifle Association, multiple sources told ABC News.
The Justice Department declined to comment.
A spokesperson for James called the subpoenas a “weaponization of the justice system,” invoking a criticism Trump used to describe her case against him that resulted in a half-billion-dollar penalty.
“Any weaponization of the justice system should disturb every American. We stand strongly behind our successful litigation against the Trump Organization and the National Rifle Association, and we will continue to stand up for New Yorkers’ rights,” the spokesperson said in a statement.
The civil fraud case is on appeal with the New York State Appellate Division’s First Department. Trump, his eldest sons and his business were found liable for 10 years of fraud that inflated the president’s net worth.
James sued the NRA in 2020, accusing the gun rights group’s former CEO, Wayne LaPierre, and others of misappropriating donor funds to finance luxury items for themselves. The jury determined LaPierre owed more than $4 million.
The subpoenas, from the U.S. Attorney’s Office for the Northern District of New York, are part of an investigation into whether James and her office violated the civil rights of Trump or the NRA executives, the sources said.
An attorney for James, Abbe Lowell, called the probe “a dangerous escalation” and “the most blatant and desperate example of this administration carrying out the president’s political retribution campaign.”
“If prosecutors carry out this improper tactic and are genuinely interested in the truth, we are ready and waiting with the facts and the law,” Lowell said in a statement.
This is a developing story. Please check back for updates.
(NEW YORK) — Record-breaking heat continues for parts of the desert Southwest into the weekend, with sweltering temperatures beginning to expand east into the Heartland.
Extreme heat warnings remain in effect for parts of the desert Southwest — including Palm Springs, California; Phoenix; and Tucson, Arizona.
High temperatures are expected to reach well into the 100s and up to 115 in spots.
Heat advisories are also in effect on Friday for other areas of the Four Corners region stretching into the Plains as the heat begins to shift east.
Places under these heat advisories include Albuquerque, New Mexico; Dallas, El Paso and Amarillo, Texas; Oklahoma City; Wichita, Kansas; Denver; and Sioux City, Iowa.
High temperatures between 100 and 110 are possible for these areas for on Friday.
Record-high temperatures are possible for Albuquerque through Saturday.
The heat is expected to be less extreme for the desert Southwest this weekend.
Later this weekend into next week, widespread heat will return to the Northeast and much of the country.
Later this weekend into next week, extreme heat will be possible for parts of northwest California, western Oregon and southwest Washington. Places from Yreka, California, up to Portland, Oregon, may see high temperatures push into the 100s and low temperatures only between 60 and 70 Sunday through Monday.
On Thursday, Phoenix saw a high temperature of 118 degrees. This not only was the hottest temperature recorded for the month of August, it is also tied for the ninth-hottest day all time since records began in 1895.
Fire weather danger persists Red flag warnings are in places across five states in the West — Oregon, Utah, Colorado, Wyoming and New Mexico — for critical fire weather conditions that are keeping a strong foothold this week.
Single-digit humidity and wind gusts between 35 to 55 mph are possible anywhere in these areas, though it depends on exact location.
These conditions will be conducive to rapid fire spread with any new or existing wildfires in these areas.
Fire weather conditions are expected to remain critical through at least Saturday, but may persist into the beginning of next week.
A red flag warning is also in effect for Medford, Oregon, due to dry and breezy conditions.
US President Donald Trump (R) meets Russian President Vladimir Putin (L) on the first day of the G20 summit in Osaka, Japan on June 28, 2019. (Photo by Kremlin Press Office / Handout/Anadolu Agency/Getty Images)
(WASHINGTON) — President Donald Trump’s Friday deadline has arrived for Russia’s Vladimir Putin to agree to a ceasefire with Ukraine or face “secondary sanctions” against countries that buy oil from Russia.
But uncertainty remains as to whether the U.S. will hit Moscow with new economic penalties amid talk of a possible bilateral meeting between Trump and Putin happening soon.
Trump on Thursday was asked directly if his Aug. 8 deadline for Putin to make peace or face consequences still applied.
“It’s gonna be up to him,” the president responded. “We’re going to see what he has to say. It’s gonna be up to him. Very disappointed.”The White House is pushing for a trilateral summit between Trump, Putin and Ukrainian President Volodymyr Zelenskyy, though Trump said Putin meeting with Zelenskyy wasn’t a condition for he and Putin to meet.
“They would like to meet with me and I’ll do whatever I can to stop the killing,” Trump said on Thursday.
Trump, who once said he could end the Russia-Ukraine war within his first 24 hours in office and touted his personal relationship with Putin, has expressed increasing frustration with the Russian leader.
In mid-July, Trump said he was giving Putin a 50-day ultimatum to stop the fighting. He then moved up the timeline to 10 days, citing his disappointment with Putin.
“I want to be generous, but we just don’t see any progress being made,” Trump said at the time. “I’m not so interested in talking anymore. He talks, we have such nice conversations, such respectful and nice conversations, and then people die the following night in a — with a missile going into a town and hitting.”
Tensions between the U.S. and Russia escalated last week when Trump announced he was moving nuclear submarines in response to what he called “highly provocative statements” from the deputy chair of Russia’s security council, Dmitry Medvedev.
Medvedev, also the former president of Russia, had sounded off on Trump’s ceasefire deadline, writing on social media that “each new ultimatum is a threat and a step towards war.”
While Trump said the nuclear submarines would be moved in response, he and the White House would not specify what capabilities the submarines have or other questions surrounding the announcement.
And earlier this week, Trump indirectly upped the pressure on Russia by doubling his tariff rate against India over India’s imports of Russian oil.
Firefighters battle flames from the Canyon Fire on August 7, 2025 in Castaic, California/Eric Thayer/Getty Images
(LOS ANGELES) — The Canyon Fire, a rapidly spreading blaze in California, is impacting communities in the Los Angeles area as thousands have been placed under evacuation orders and warnings, according to the Los Angeles County Board of Supervisors Chair Kathryn Barger.
The local emergency proclamation issued by officials enables the county to “expedite access to critical resources and cut through bureaucratic red tape to enhance firefighting and recovery efforts,” according to a statement from Los Angeles County.
So far, the Canyon Fire burning in Ventura and Los Angeles counties has grown to just under 5,000 acres in a matter of hours and is 0% contained, according to the Ventura County Fire Department. On Thursday, the fire had burned 1,500 acres.
Five zones in Los Angeles County are under evacuation orders, with 2,700 residents evacuated and 700 structures threatened by the flames, officials said. Six other zones in this county are currently under an evacuation warning, with 1,400 residents and 5,000 structures at risk, officials said.
Ventura County also has five zones under evacuation orders and two areas under evacuation warnings.
“The issuance of this emergency proclamation is a crucial step in our fight against the Canyon Fire,” said Supervisor Kathryn Barger. “It allows us to unlock vital state and local resources more quickly and removes barriers that could slow down our first responders. Our priority is to protect lives, homes, and critical infrastructure, and this proclamation will help ensure that we have the tools and support necessary to meet the urgent needs of our communities.”
The emergency declaration grants authorities the flexibility to “coordinate across agencies, mobilize additional firefighting personnel and equipment, and streamline procurement processes,” officials said.
The blaze, which began on Thursday afternoon, is burning east with a “rapid rate of spread in light to medium fuels,” according to Cal Fire. Multiple strike teams of engines, hand crews and dozers have been ordered to “reinforce the initial response,” with 250 personnel and seven helicopters assigned to fight the flames, officials said.
As of Thursday evening, there have not been any residences damaged or reported injuries, according to the Los Angeles County Fire Department.
Supervisor Barger urges all residents in affected areas to remain vigilant, follow evacuation orders, and stay informed through official channels as the situation evolves.
Officials said residents should visit the Los Angeles County Emergency Website for incoming updates and information.
This wildfire comes as the Gifford Fire — which is situated within the Los Padres National Forest in Solvang, California — has burned nearly 100,000 acres and is the largest blaze in the state this year, according to Cal Fire. This blaze, which began on Aug. 1, has destroyed 99,232 acres and is 15% contained, according to an update from officials on Thursday evening.
People are seen in smoke after Israel targeted the area near Abbas Junction in western Gaza City, Gaza on August 08, 2025/Khames Alrefi/Anadolu via Getty Images
(LONDON) — On the heels of Israel’s security cabinet approving plans to occupy Gaza City, the United Nations High Commissioner for Human Rights, Volker Turk, said “this further escalation will result in more killing, more unbearable suffering, senseless destruction,” according to a statement released Friday morning.
Turk called for the offensive to be “immediately halted.”
“The Israeli Government’s plan for a complete military takeover of the occupied Gaza strip must be immediately halted,” Turk said. “It runs contrary to the ruling of the International Court of Justice that Israel must bring its occupation to an end as soon as possible, to the realisation of the agreed two-State solution and to the right of Palestinians to self-determination.”
Family members of hostages and other protesters gathered in front of the building where the Israeli cabinet was in session to protest Netanyahu’s current proposal to occupy all of Gaza, calling the move a “death sentence” for the remaining hostages in a statement from the Hostages and Missing Families Forum Headquarters.
“For a year and ten months we’ve been trying to believe that everything is being done to bring them back – you have failed. Now it’s necessary to do the one thing the government hasn’t yet done – put a comprehensive deal on the table that will bring them all home together,” said Anat Angrest, mother of hostage Matan Angrest.
Israel’s plan for an expansion of military operations comes amid international condemnation of the deteriorating humanitarian situation in the Gaza Strip.
“The Security Cabinet has approved the Prime Minister’s proposal for the defeat of Hamas,” the Israeli prime minister’s office said in a statement released on Thursday. “The IDF [Israel Defense Forces] will prepare for the takeover of Gaza City while ensuring the provision of humanitarian aid to the civilian population outside the combat zones.”
Turk, however, said that the potential escalation will only lead to more problems in the region. leading to, what he says, “senseless destruction and atrocity crimes.”
“The war in Gaza must end now. And Israelis and Palestinians must be allowed to live side by side in peace,” said Turk. “Instead of intensifying this war, the Israeli Government should put all its efforts into saving the lives of Gaza’s civilians by allowing the full, unfettered flow of humanitarian aid. The hostages must be immediately and unconditionally released by Palestinian armed groups. Palestinians arbitrarily detained by Israel must also be immediately and unconditionally released.”
In a Fox News interview earlier this week, Israeli Prime Minister Benjamin Netanyahu said repeatedly that he does not want to “govern Gaza,” but he wants to “hand it over to Arab forces that will govern it properly without threating,” Israel.
Hamas, responding to the Fox News interview, said in a statement that “Netanyahu’s statements represent a blatant reversal of the negotiation process and clearly expose the real motives behind his withdrawal from the latest round of talks, despite us nearing a final agreement.”
On Sunday, an Israeli official told ABC News that Netanyahu was pushing to expand the military operation in Gaza on the grounds that he felt Hamas is not interested in reaching a new ceasefire deal under which surviving hostages could be released.
When asked about the possible expansion of the campaign in Gaza, U.S. State Department spokesperson Tammy Bruce said Tuesday, “Reporting is one thing. Real plans might be another. We are not in the business of interpreting statements from foreign governments when and if they’re made.”
“We do remain focused on freeing the hostages, including the remains of two Americans, and ensuring that Hamas never rules Gaza again,” Bruce said.
(NEW YORK) — Weak jobs data came out hours before President Donald Trump fired the head of labor statistics. A report on gross domestic product indicated a slowdown of growth over the first half of the year. A sweeping round of tariffs hit nearly 70 countries.
These events — all since last week — prompted some analysts to warn of a recession and others to raise concerns about the political independence of gold-standard U.S. economic data.
The stock market, however, hardly blinked.
The tech-heavy Nasdaq has ticked up 0.4% since the end of trading last Tuesday, a day before the GDP report marked the first in a series of major developments. Over that same period, the S&P 500 has dropped 0.6%, while the Dow Jones Industrial Average has fallen 1.4%.
Despite mixed results, the indexes remain well above where they stood three months ago. The Nasdaq has surged 20% since May, while the S&P 500 has jumped 13%. The Dow has climbed 7% over that period.
Analysts who spoke to ABC News attributed investor optimism to robust corporate profits, the prospect of interest rate cuts at the Federal Reserve and an abiding expectation that Trump will not return to the steep tariffs initially rolled out in April.
The resilient stock market has generated a momentum of its own, some analysts added.
“The mindset of the market is to embrace risk because that brings rewards rather than losses — keep shrugging it off,” Steve Sosnick, chief strategist at trading firm Interactive Brokers, told ABC News. “That can paper over a lot of concerns.”
The economy added an average of about 35,000 jobs over three months ending in July, which marks a major slowdown from roughly 128,000 jobs added monthly over the prior three months, U.S. Bureau of Labor Statistics data on Friday showed. Employers are hiring at their slowest pace since 2020.
Two days earlier, fresh GDP data indicated average annualized growth of 1.2% over the first half of 2025, well below 2.8% growth last year.
Hours after the release of the jobs report on Friday, Trump fired BLS Commissioner Erika McEntarfer, an appointee of former President Joe Biden who was confirmed by a bipartisan vote in the Senate in 2024.
In a social media post, Trump volleyed sharp criticism and baseless accusations at McEntarfer, claiming without evidence that the data had been “manipulated.” The jobs report featured revisions of previous months’ data, which is a routine practice.
“Trump touted his economic performance in a social media post: “The Economy is BOOMING under ‘TRUMP’ despite a Fed that also plays games, this time with Interest Rates.”
McEntarfer did not immediately reply to ABC News’ request for comment.
“It has been the honor of my life to serve as Commissioner of BLS alongside the many dedicated civil servants tasked with measuring a vast and dynamic economy,” McEntarfer said in a social media post after her dismissal. “It is vital and important work and I thank them for their service to this nation.”
The major stock indexes fell markedly last Friday, suggesting concern among traders about the weak jobs report. Within days, however, stocks had largely recovered the losses.
Alongside mixed signals from the economy, a series of major companies have released strong earnings, indicating a resilient corporate bottom line. The list of high-performers includes tech giants like Meta and Microsoft, which account for a disproportionately large share of the S&P 500.
“The markets like to focus on earnings,” Ed Yardeni, the president of market advisory firm Yardeni Research and former chief investment strategist at Deutsche Bank’s U.S. equities division, told ABC News. “They’ve been pretty impressive considering some of the economic data has looked soft of late.”
The outlook for the economy remains uncertain, leaving open the possibility of continued growth and soaring stocks, some analysts said. The economy has largely averted the type of widespread job losses that often accompany a recession. Consumer spending, which accounts for about two-thirds of economic activity, ticked higher over three months ending in June.
If the economy sours, the Federal Reserve will likely move forward with interest rate cuts, buoying the market, Sosnick said.
“There’s a belief that there’s nothing better for the market than a rate cut,” Sosick added.
Still, the combination of elevated tariffs and sluggish hiring could hurtle the U.S. toward an economic double-whammy known as “stagflation,” in which the economy slows while prices rise.
Potential stagflation poses difficulty for the Fed. If the Fed raises interest rates as a means of protecting against tariff-induced inflation under such a scenario, it risks stifling borrowing and slowing the economy further. On the other hand, if the Fed lowers rates to stimulate the economy in the face of a potential slowdown, it threatens to boost spending and worsen inflation.
“There’s definitely a possibility the market is getting it wrong on inflation,” Jay Ritter, a professor of finance at the University of Florida, told ABC News.
For now, markets remain opportunistic about current gains, rather than wary of possible headwinds that may emerge in the coming weeks or months, Sosnick said.
“This market is preferring to deal with the here and now than deal with the conceptual,” Sosnick added.
