FINANCIAL TIMES
-Donald Trump's tariffs have sparked a debate at the Federal Reserve, with top policymakers deciding whether to cut interest rates this summer or hold them steady for the remainder of 2025. Christopher Waller, a potential candidate to replace Jay Powell, called for a rate cut next month and emphasized the need to base policy on data. Waller's comments came two days after the Fed kept rates on hold for its fourth consecutive meeting, following a 1 percentage point reduction in 2024. Trump has criticized the Fed for not slashing rates, calling for as much as 2.5 percentage points of cuts and referring to Powell as an "American disgrace."
-Israeli Prime Minister Benjamin Netanyahu began warning about Iran's nuclear program as a young MP in the 1990s, predicting the Islamic republic would have a weapon by the end of that decade. As prime minister, he intensified his warnings, appearing at the UN with a cartoon-style drawing of a bomb in 2012 and infuriating Barack Obama by campaigning against his efforts to limit Iran's nuclear activities by diplomatic means in an address to Congress in 2015. Netanyahu's international activities were driven by the existential threat of stopping Iran from getting a bomb. After Hamas's 2023 attack, Netanyahu's chance to follow through on his warnings seemed lost, as the failures leading up to the attack left his image as Israel's Mr. Security in tatters. His refusal to acknowledge any responsibility enraged many of his compatriots, and even members of his Likud party concede that if there had been a mechanism to replace him in the days after October 7, he might have been removed. Instead, he survived, outmaneuvering his rivals, bolstering his parliamentary majority, and ignoring protests and polls showing a solid majority of the public demanding he step down.
-European foreign ministers have urged Iran to resume negotiations with Donald Trump's administration to prevent the US from joining Israel's war against the Islamic republic. French, German, and UK ministers warned Iran that Tehran may have to give up its red line of refusing to negotiate with Washington while under Israeli attack to prevent the US from joining the operation. Both Israel and the US agreed that peace can only be achieved through diplomacy, but the US military intervention is currently being planned. The negotiations were held in Geneva, the first direct contact between western and Iranian officials since Israel launched its attack a week ago. The US president said after the talks that he would not ask Israel to stop its air strikes on Iran to accelerate negotiations for a nuclear deal with Tehran and avert Washington's involvement in the war.
- Donald Trump has hinted that his administration may be close to agreeing a deal with Harvard, suggesting his recent attacks on the elite university are coming to an end. Trump and other White House officials have demanded reforms at Harvard, accusing it of failing to act robustly against antisemitism and not providing the government with information on students who were allegedly breaking the law. Harvard rejected the claims, accusing the administration of attacking academic freedom and free speech. In response, the White House hit back with measures including cancelling billions of dollars in government funding, threatening to withdraw Harvard's tax exempt status, and blocking it from accepting international students.
-Japan has canceled a top-level meeting with the US due to the Trump administration's sudden directive to increase defense spending. The US was due to meet Japan's defense minister Gen Nakatani and foreign minister Takeshi Iwaya in Washington on July 1, but the meeting was scrapped after the US asked Japan to increase its defense spending to 3.5%, higher than its earlier request of 3%. This increased demand was made by Elbridge Colby, the third-most senior official at the Pentagon, and sparked anger in Tokyo. The tension over security issues comes as the allies hold tough trade talks after President Trump imposed "reciprocal" tariffs on Japan. The decision to cancel the meeting is also related to the July 20 Upper House elections, where the ruling Liberal Democratic party is expected to lose seats.
-The Italian region of Puglia will offer subsidized egg-freezing for healthy women, while the central government plans to promote fertility testing. The region has allocated €900,000 for "social freezing," allowing low-income residents aged 27-37 to apply for up to €3,000 towards the cost of extracting their eggs and freezing them for potential in vitro fertilization later. This initiative aims to counter the lack of births and provide women with the opportunity to realize their dream of motherhood. Puglia is the first time Italy is using public funds for non-medical reasons for egg-freezing. However, any use of eggs for IVF will require women to be married to a man, as Italy has long prohibited single or same-sex partners from having babies via in vitro fertilization.
-SoftBank founder Masayoshi Son is promoting the idea of a $1T artificial intelligence and robotics complex in Arizona, which could involve a free-trade zone and TSMC's involvement. The plan, which has been discussed with US commerce secretary Howard Lutnick, aims to bring high-tech manufacturing to the US at scale. SoftBank officials have also discussed the project with local and federal politicians to secure tax breaks. The final size of the project may vary significantly if approved, depending on the level of interest from tech groups. The Arizona concept is the latest large-scale, creative plan promoted by Son, who has already pledged $500B to the Stargate project to scale up US data centers and artificial intelligence infrastructure with OpenAI, Oracle, and Abu Dhabi's MGX.
-OpenAI's former CTO Mira Murati has raised $2B for her new artificial intelligence start-up, Thinking Machines Lab, valued at $10B. The deal, which closed recently, was one of the largest initial funding rounds in Silicon Valley's history. Murati's name and reputation were used to attract investors, and Andreessen Horowitz led the round, with participation from Sarah Guo's Conviction Partners. The fundraising demonstrates the huge investor appetite in AI and the faith in the vision of noteworthy founders to compete with companies like OpenAI, Anthropic, Google, and Meta. Murati left OpenAI in September and had previously worked as a senior product manager at Tesla. She was one of the executives who raised concerns about Sam Altman's leadership before a failed board coup to oust OpenAI's CEO in November 2023.
-Novo Nordisk's injectable obesity drug, amycretin, has shown potential to deliver higher weight loss than current market blockbusters. Participants in the trial lost an average of 24.3% of their body weight on the highest dose, compared to 1.1% for those on a placebo. The results come as the Danish pharma group races rival Eli Lilly to secure the best successor to current best sellers, Lilly's Zepbound and Novo's Wegovy, which respectively cause average weight loss of 22.5% and 15%. A tablet version of amycretin also caused an average weight loss of 13.1% on the highest dose. Novo plans to pursue further trials of both oral and injectable versions of the drug.
-The US audit regulator, the Public Company Accounting Oversight Board (PCAOB), has been granted a reprieve after a Senate parliamentarian ruled that Republicans' plan to close the agency as part of their tax and spending bill would violate Senate rules. Republicans had planned to scrap the PCAOB and hand its powers to the Securities and Exchange Commission, arguing that this would save money for taxpayers and listed companies that pay fees to fund the agency. However, the Senate parliamentarian ruled that the plan did not comply with requirements that only measures that affect the US budget can be included in the legislation. The PCAOB is responsible for inspecting accounting firms in the US and overseas that audit companies listed on US exchanges.
-Poland's culture ministry is preparing to transfer its most valuable artworks abroad in case of a Russian invasion. Culture minister Hanna Wróblewska said evacuation planning was necessary as Poland's nearly 1,000 museums could no longer operate under a theoretical security concept as Russia continues to wage war in Ukraine. The ministry is in talks with authorities abroad about hosting evacuated artworks from around 160 Polish state institutions. Private museums and galleries are also expected to follow suit. The plan, expected to be finalized by the end of the year, is part of a broader security push by Prime Minister Donald Tusk's government, which includes reinforcing border protection and doubling the size of the Polish armed forces to 500,000 troops.
NEW YORK TIMES
-Trump is considering last-minute diplomacy as an alternative to bombing Iran's main uranium enrichment facility in a two-week window. However, the environment is different this time, with Ayatollah Khamenei likely in hiding. Iran's foreign minister, Abbas Araghchi, is open to placing limitations on Iran's nuclear output, similar to what he and his colleagues negotiated with the United States a decade ago. However, he told European counterparts in Geneva that Iran would never negotiate as long as Israel was dropping missiles on its military bases and nuclear facilities, and carrying out targeted killings of Islamic Revolutionary Guards Corps officers and nuclear scientists. Trump, on the other hand, stated that two weeks would be the maximum time for negotiations, and dismissed the idea that the meeting in Europe would slow things down. The extent of Trump's interest in negotiations or just buying time to better prepare for a military assault and its aftermath remains unclear.
-The conflict between Israel and Iran has reached its ninth day, with Iran sending missiles towards Israel and Israel launching airstrikes against Iranian missile sites. The Israeli military claimed to have launched a wave of airstrikes against Iranian missile sites, but the full toll remains unclear. A strike in Qom killed Mohammed Said Izadi, a senior official in Iran's Quds Force responsible for maintaining ties with Palestinian armed groups. Israeli jets also struck Iranian nuclear sites in Isfahan. Talks between Iran and Europe ended without a breakthrough, with the European Union's top diplomat meeting with Iran's foreign minister in Geneva. The European effort aims to offer a diplomatic off-ramp for Iran, preventing President Trump from escalating the conflict.
-Trump's director of national intelligence, Tulsi Gabbard, posted a video on social media describing her visit to Hiroshima, Japan, and warning of the threat of nuclear war. Gabbard warned that political elites and warmongers are causing fear and tension between nuclear powers. Trump berated her for the video, stating it would scare people and officials should not discuss it.
- Trump has given himself two weeks to decide on his approach to the ongoing war between Israel and Iran, which began last week by attacking Iran. This delay could allow him to expand his options and calibrate the politics of any decision. However, it will also have real consequences for Israelis and Iranians. In Israel, civilians are rushing into bomb shelters to avoid being hit by Iranian missiles, with at least two dozen killed. In Iran, where there are fewer shelters, the death toll is higher than 200, including many civilians. Following Israeli evacuation orders, Iranian civilians have been forced to flee Tehran, leading to traffic jams, gas shortages, and internet blackouts. An American strike is not expected to end the suffering, but two weeks of diplomacy will lock us in for up to two weeks of continued fighting between Israel and Iran.
-Vice President JD Vance criticized Senator Jose Padilla for engaging in "political theater" and misspoke his name. Vance blamed Governor Gavin Newsom of California and Mayor Karen Bass of Los Angeles for the violence caused by protesters and the obstruction of immigration enforcement. He shook hands with about 20 Marines at the federal building and alternated between attacks on California Democrats and praise for law enforcement. Vance criticized Newsom and Bass for going to war against the people trying to keep the community safe. Newsom responded by asking Vance to say it to his face. Bass accused the Trump administration of orchestrating "a stunt and an experiment" by sending the California National Guard and Marines to Los Angeles, which has been mostly quiet since Saturday.
-The Trump administration has announced layoffs for over 600 employees at Voice of America, a federally funded news organization providing independent reporting to countries with limited press freedom. The reductions will shrink the staff count to less than 200, around one-seventh of its head count at the beginning of 2025. Journalists and support staff will be put on paid leave until September 1. The terminations are part of the Trump administration's ongoing attack on federally funded news networks, including Voice of America.
- President Trump has criticized the existence of the national holiday Juneteenth, which commemorates the end of slavery. He criticized the lack of non-working holidays in America, a trend Trump has been attempting to reframe the country's history involving racism and discrimination. Trump has also criticized government websites for removing words like "injustice" and "oppression," and for obscuring the contributions of Black heroes. He has also criticized the Smithsonian Institution for its "divisive, race-centered ideology" in its exhibits on race and ordered the renaming of monuments to honor Confederate soldiers who fought to preserve slavery. This pattern of actions aims to minimize, ignore, or erase the experiences and history of Black people in the United States.
- Zohran Mamdani, a Democratic socialist and assemblyman, has requested a waiver from the city's Campaign Finance Board to exceed the $8 million spending cap for the Democratic primary for mayor in New York. He aims to level the spending advantage of his chief rival, former Gov. Andrew M. Cuomo, with his super PAC, Fix the City, raising over $24 million. Mamdani has been campaigning with city comptroller Brad Lander in Brooklyn and walked the length of Manhattan, inviting his followers to join him. However, the Campaign Finance Board stated that increasing the spending cap would be against the rules, as only when a candidate not participating in the matching funds program raises more money than those participating. This was the case in the 2021 mayoral primary when Ray McGuire, a long-serving Black executive on Wall Street, blew through the spending cap, raising it from $7.3M to $10.3M.
NEW YORK POST
-Israel's Defense Minister Israel Katz announced that the military had killed Saeed Izadi, a veteran commander in the Iranian Revolutionary Guards' overseas arm, in an apartment in Iran's Qom province. The commander, who led the Palestine Corps of the overseas arm, or Quds Force, was responsible for all weapons transfers from the Iranian regime to its proxies across the Middle East. The Israeli military later said it killed a second commander of the Guards' overseas arm, Benham Shariyari, during a strike on his vehicle overnight in western Tehran. The Israeli military said Shariyari supplied missiles and rockets launched at Israel to Hezbollah, Hamas, and Yemen's Houthis. There was no confirmation from the IRGC on the killing of the two commanders. The Quds Force built up a network of Arab allies known as the Axis of Resistance, establishing Hezbollah in Lebanon in 1982 and supporting the Palestinian militant Islamist group Hamas in the Gaza Strip.
-SoftBank CEO Masayoshi Son is reportedly partnering with Taiwan Semiconductor Manufacturing Company (TSMC) to build a $1T US complex for robots and artificial intelligence. The center, based in Arizona, could help bring manufacturing back to the US, similar to the production hub in Shenzhen, China. This comes amid President Trump's call for an all-hands approach to manufacturing opportunities, particularly for tech companies and automakers. Son is seeking $165 billion in US investment and has opened its first Arizona factory as a partner.