Goldman Sachs’ Ashok Varadhan has a simple message for investors worried about higher interest rates, elevated oil prices and the durability of the economy: Stay invested.

Varadhan, the firm’s co-head of global banking and markets, pointed to three reasons for his constructive outlook: He doesn’t expect the Federal Reserve to raise interest rates this year, sees oil falling well below $70 a barrel later in 2026 and believes a resilient economy will increasingly benefit from productivity gains tied to artificial intelligence.

“Stay invested would be my advice,” Varadhan said in an episode of Goldman’s “The Markets” podcast last week.

His view on rates runs against market pricing that has reflected some risk the Fed could resume tightening amid lingering inflation concerns.

“I don’t think we will see hikes in the latter part of this year,” Varadhan said. “I think rates are going to stay on hold.”

Following a disappointing jobs report Friday, traders shifted their bets on when the Fed might hike. Odds for a move in September fell to around 50% Monday and to 63% for October, according to the CME Group’s FedWatch gauge of futures prices.

Disinflationary force

Some of the forces that pushed inflation higher are beginning to recede, including the impact of tariffs, he said. An easing of geopolitical tensions around the Strait of Hormuz could further alleviate price pressures.

Varadhan also sees AI eventually becoming a disinflationary force. While the enormous infrastructure buildout needed to support artificial intelligence can strain resources and contribute to inflation in the near term, the productivity benefits should have the opposite effect once that capacity is in place, he said.

Oil is another reason for his optimism. Varadhan expects crude prices to retreat significantly as the year progresses, providing another potential source of relief on inflation.

“I think energy is going to go back down,” he said. “I think oil settles back down well below $70 a barrel, maybe even lower once we get towards the latter part of the year.”

West Texas Intermediate futures climbed back above $80 per barrel Monday as doubt grew that the U.S. and Iran will reach a deal to increase ship traffic through the Strait of Hormuz.

Resilient economy

The third pillar of Varadhan’s view is the resilience of the economy. Despite a series of external shocks, underlying nominal growth has remained remarkably durable, he said. If some of those pressures fade, the economy could continue to expand while benefiting from AI-driven productivity improvements.

That resilience is also keeping Varadhan constructive on credit. Heavy issuance means investors should demand somewhat more compensation for taking risk, he said, but the strength of the economy has helped prevent spreads from widening dramatically.

“If you think the exogenous shocks are going away and you still have the resilience of the economy,” Varadhan said,…

Wherever volatile fuel prices head this year, don’t expect bargain flights.

Airfare in the U.S. in June was up 26.5% compared with a year earlier, according to the latest federal data.

Airline leaders say customers continue to book even after carriers hiked fares. They told Wall Street analysts this month that they’re expecting to hold onto that pricing power at least through the rest of the year, if not longer.

Traveler Marjorie Aran said she and her husband paid a combined $800 to go from New York to Chicago in economy on United Airlines this week to visit their daughter.

“We used to go to Chicago for a couple of hundred dollars,” she said. Asked if she would skip a trip because of the fares she said no. “We can afford it.”

Airlines are betting that stays true for millions of consumers.

The average Southwest one-way fare, for example, was $225.61 in the second quarter, up from $186.65 during the same span of 2025.

“Despite high fuel and high prices, we’re seeing really strong demand,” Southwest Airlines CEO Bob Jordan told CNBC’s “Squawk on the Street” in late July.

United said it expects to pay about $6 billion more for fuel this year than it expected at the start of 2026. American Airlines forecast a $6 billion increase in fuel costs compared with last year, each a jump of a more than 50% from 2025. Both carriers said demand is still strong, even as they’re passing costs on to customers with higher fares.

“We observed minimal to no negative impact on demand from higher price points, a trend we see continuing,” United Chief Commercial Officer Andrew Nocella told Wall Street analysts on the company’s July 16 earnings call. The carrier expects unit revenue year over year for the rest of 2026 to rise and even exceed the second quarter’s increase, he said.

Airlines are eager to make up not just the billions of dollars more they’ve paid for fuel this year, but also to cover higher costs of labor, maintenance and basic operating expenses like increased airport fees.

“Labor costs have escalated dramatically. Maintenance is off the charts in terms of escalation. And those are all costs that every single airline pays the same,” United CEO Scott Kirby said on the call.

The surprise surge in fuel costs — airlines’ biggest expense after payroll — was a shock to the industry. Airlines pruned schedules this year, which can mean fewer flights per day or week on a certain route. That leaves customers with a lower number of flights to choose from and can lift fares.

According to S&P Global Energy Platts data, jet fuel prices have eased from four-year highs in April, but are still up about 50% since Feb. 28, when the U.S. and Israel’s strikes on Iran kicked off the monthslong military conflict that has choked off a main shipping channel for months.

United said its fuel costs rose $575 million from the start of July until mid-month as it was reporting results, knocking $1.12 off of third-quarter adjusted earnings.

In a sign of how seriously…

Losing weight with GLP-1 drugs is only half the battle. Keeping it off long term has proved even harder.

Factors such as side effects, high out-of-pocket costs, injection fatigue and stigma around obesity treatment drive troves of patients – some studies estimate roughly half or more – to stop GLP-1s within a year and risk regaining the weight they lost. 

Years from now, Vivani Medical believes a tiny GLP-1 implant placed under the skin could help address that problem. 

The biotech company is in the early stages of developing an experimental implant of semaglutide, the active ingredient in Novo Nordisk‘s blockbuster obesity injection Wegovy and diabetes counterpart Ozempic. The Danish pharma giant announced on Tuesday a new agreement with Vivani to evaluate its lead semaglutide implant, NPM-139. 

Vivani envisions patients would initially use it as a maintenance treatment rather than a therapy people take when they start GLP-1s. Under that approach, patients would first reach an appropriate dose of semaglutide using existing injections or pills, then potentially switch to the implant for longer-term treatment.

If everything goes to plan, Vivani believes the device could eventually serve as a convenient option administered just twice a year — or even once annually — to help patients stay on therapy and maintain weight loss, while potentially reducing some side effects associated with existing GLP-1 medicines. 

“It’s really critical to have options that make it easy for people to get the full benefits of these treatments and to not discontinue at the rates we’re seeing,” Vivani President and CEO Adam Mendelsohn said in an interview. “What these drugs are capable of is not being carefully taken advantage of right now.” 

But the implant is still at least several years out from living up to that promise. 

The device needs to clear several clinical trials and regulatory hurdles before reaching patients. Some endocrinologists and other doctors said there could be demand for an implant, but they also want to see concrete data on how effective it will be compared with existing medicines and how well patients will tolerate it. They also raised questions about whether providers would be willing to adopt it. 

“I really want to see that this is going to work well and deliver results for patients, but I also want to see that it’s something that my patients can stay on long term,” Dr. Miranda Stiewig-Rapp, director of UC Davis Health’s Obesity Clinic, said in an interview. “I’m probably overall very skeptical, but I’m happy to be proven wrong.”

The potential cost of the implant and whether insurers would cover it if approved also remain unclear. That makes it difficult to estimate what the implant’s sales could be in a GLP-1 market that some analysts expect could exceed $100 billion by the early 2030s.

In a statement to CNBC, Novo Nordisk confirmed the agreement with Vivani and said it is…

A federal judge in Washington denied on Thursday a prosecutor’s request to erase the record of the government’s legal losses its attempt to investigate former Federal Reserve Chair Jerome Powell.

Chief Judge James E. Boasberg in the D.C. Circuit’s scathing order, replete with media quotes and links to YouTube clips, denied a motion by the office of U.S. Attorney Jeanine Pirro to vacate his earlier rulings that had gone against Pirro.

The latest development caps a monthslong legal saga that saw Boasberg halt aspects of an investigation by Pirro into the Fed. Boasberg in March quashed a pair of subpoenas Pirro issued because, he ruled, Pirro’s effort was intended at least in part to “harass and pressure Powell” on behalf of the president, who wanted lower interest rates.

Pirro in April agreed to close the investigation of Powell under pressure from Republican Sen. Thom Tillis of North Carolina. Tillis dropped a Senate blockade of the confirmation of Kevin Warsh, Trump’s nominee to replace Powell as leader of the Fed. Warsh was confirmed in May and will chair his first meeting of the Fed’s rate-setting committee next week.

Powell stepped down from the Fed chair as required by law but opted to retain his separate seat on the Fed’s board. He wanted to ensure that the legal threat to the Fed had truly ended, even after Pirro said she had dropped the investigation.

Boasberg in a scathing order Thursday appeared sympathetic to Powell’s perspective that the legal threat to the Fed may not truly have ended with Pirro’s decision to drop the investigation. Pirro said she could reopen the investigation if she chose.

“It sounds like you’re going to keep trying to find out more,” CNN host Jake Tapper said to Pirro in an interview. “Pirro essentially confirmed that interpretation,” Boasberg wrote.

Despite prosecutors’ attempts to confine the arguments to the courtroom, Boasberg drew on evidence of what Pirro and President Donald Trump had said in the press. Boasberg’s orders were simply “using the President’s explicit statements as evidence of what his deputies understood that he wanted,” he wrote.

Boasberg wrote that Pirro’s legal rationale in the wake of his decision had “vacillated,” first promising to appeal, and then switching to a “curious” strategy of asking him to vacate his earlier rulings now that the investigation was over. Boasberg’s latest order denied that motion to vacate.

Boasberg’s initial ruling had found that although a prosecutor ought generally to be allowed to issue grand jury subpoenas on minimal suspicion, evidence that those subpoenas might be part of a campaign of political harassment raised the bar for allowing an investigation to proceed. Pirro’s motion to vacate…

Australia’s central bank on Tuesday raised its policy rate to 4.35%, matching its December 2024 peak, as inflation remains elevated.

The move by the Reserve Bank of Australia was in line with expectations in a Reuters poll of economists and marked its third consecutive rate increase.

Eight members of the board voted for the hike, while one voted to hold rates at 4.1%.

In its statement, the RBA said inflation had picked up materially in the second half of 2025, with conflict in the Middle East pushing up fuel and commodity prices.

“As expected, developments in the Middle East are having an impact on inflation. Higher fuel prices are adding to inflation and there are indications that this is likely to have second-round effects on prices for goods and services more broadly,” it added.

The central bank said that inflation is likely to remain above its 2% to 3% target for some time and that the risks remain elevated.

The RBA also appeared to signal that more rate hikes were on the horizon, with its economic forecasts penciling in a 4.7% policy rate in December 2026, 50 basis points higher than projected in early February.

Should the policy rate exceed 4.35%, it would be the highest since December 2011.

Inflation forecasts for the bank were also upgraded to 4.8% for the June quarter and 4% for the year ending 2026, up from the previous February forecast of 4.2% and 3.6%, respectively.

Economic growth for 2026 was revised down to 1.3% from 1.8%.

Australia’s economy grew 2.6% from a year earlier in the fourth quarter, its fastest pace in two years, beating expectations.

The decision follows recent inflation data showing price pressures remain persistent. Consumer prices rose 4.09% in the first quarter from a year earlier, the highest in more than two years.

In March, inflation climbed to 4.6%, the highest since Australia began publishing monthly consumer price index data in 2025.

The RBA had signaled at its March meeting that further rate increases were likely, though policymakers differed on timing.

“Developments in the Middle East remain highly uncertain, but under a wide range of possible scenarios could add to global and domestic inflation,” the RBA said after its March meeting.

This is breaking news, please check back for updates.

Federal Reserve chair nominee Kevin Warsh said Monday the central bank must be largely independent of political influence but also should stay focused on its primary goals.

In remarks to be delivered Tuesday to the Senate Banking Committee, Warsh also expressed firm commitment to fighting inflation with only one mention of the labor market.

“Simply stated, Fed independence is largely up to the Fed,” the former Fed governor said.

Warsh’s speech also features a familiar criticism he has brought in recent years, namely that the Fed on multiple occasions has overstepped its boundaries and reached into areas such as climate change and social inequality.

“The Fed must stay in its lane. Fed independence is placed at greatest risk when it strays into fiscal and social policies where it has neither authority nor expertise,” he added.

President Donald Trump announced in late January that Warsh would be his pick to replace current Chair Jerome Powell.

Since the replacement process began, questions have been raised about whether Warsh or any other Trump pick would be able to withstand the repeated pressure from Trump and other White House officials to lower interest rates.

While Warsh did speak of the importance in political independence, he issued several qualifiers.

“I do not believe the operational independence of monetary policy is particularly threatened when elected officials — presidents, senators, or members of the House — state their views on interest rates,” he said.

Moreover, he said the Fed does not enjoy the same independence in some of its other responsibilities as it does when setting interest rates and other aspects of monetary policy. He specifically mentioned “their stewardship of public monies,” relevant as an investigation proceeds into the Fed’s multi-billion-dollar headquarters renovation.

Though Powell’s term expires in May, the nomination has been complicated by an investigation the U.S. Attorney’s Office in Washington, D.C. has launched into the project. Sen. Thom Tillis, R-N.C., has vowed to block Warsh’s nominee from leaving committee until the investigation is resolved, and Powell himself has pledged to stay on as chair until the matter is settled as well.

Despite the potential roadblocks, administration officials remain confident Warsh will be confirmed.

“The White House remains focused on working with the Senate to swiftly confirm Kevin Warsh as the next Chairman of the Federal Reserve. Warsh’s academic credentials, private sector success, and prior experience on the Fed Board of Governors make him eminently qualified to restore confidence and competence in Fed decision-making,” said White House spokesman Kush Desai.

In both of his terms in office, Trump has demanded the Fed lower interest rates. He has repeatedly criticized Powell, sometimes in starkly personal terms, and even has threatened to fire him on several occasions.

Trump has…

President Donald Trump said Wednesday U.S. military forces will remain deployed in and around Iran until Tehran fully complies with the “real agreement,” warning that any breach would trigger a military response larger than anything seen before.

“All US ships, aircraft, and military personnel…will remain in place in, and around, Iran, until such time as the REAL AGREEMENT reached is fully complied with,” Trump wrote on Truth Social.

“If for any reason it is not…the ‘shootin’ starts,’ bigger, and better, and stronger than anyone has ever seen before.”

Trump reiterated that it was agreed that Iran will not develop nuclear weapons, and the Strait of Hormuz will be open and safe for commercial shipping.

“In the meantime our great Military is Loading Up and Resting, looking forward, actually, to its next Conquest,” Trump added. He ended the post, which was published near midnight, with a declaration: “AMERICA IS BACK!”

The statement came a day after Washington and Tehran agreed to a two-week ceasefire brokered by Pakistan, which halted six weeks of fighting and sparked a brief relief rally in global markets amid growing optimism that energy flows may resume in the Strait of Hormuz.

Iran said safe passage through the strait would be possible but subject to coordination with its armed forces.

Israel supported Trump’s decision to suspend strikes against Iran but insisted that the ceasefire doesn’t extend to Lebanon, unleashing its harshest offensives on the country since the war broke out in February, killing at least 182 people on Wednesday.

The deadly attacks prompted a threat from Iran, which suggested that it would be “unreasonable” to proceed with talks to seek a permanent peace deal with the U.S., underscoring the fragility of the ceasefire.

The U.S. and Iran are expected to meet for a round of negotiations in Islamabad on Friday.

This is breaking news. Please refresh for updates.

Amid the ongoing Iran war, the roar of the Middle East’s commercial tourism has been replaced by the steady hum of repatriation flights, leaving vacationers to navigate the landscape of rising airfares and safety concerns. It’s yet another airspace closure that airlines have had to deal with since the 2022 Russian invasion of Ukraine.

It’s a stark contrast to a prediction from the United Arab Emirates’ Ministry of Economy and Tourism that the country would amass a market volume of almost $950 billion by 2026. Dubai, in particular, finds its position as the crown jewel of Middle East’s tourism faltering as its airports have been forced to shut temporarily during the conflict.

Canceled flights to and from the Middle East region have exceeded 46,000 since the U.S.-Israel attacks on Feb. 28, aviation data firm Cirium told CNBC previously. And at the Aviation Festival in Singapore in March, India’s SpiceJet said the Middle East conflict has significantly affected its operations due to heavy traffic between India and the region.

But it’s not just airlines that have been cancelling flights. Travelers from Asia told CNBC they have been canceling their travel plans to the Middle East and considering holidays within their own region instead.

Her plans were quickly cut short when she began looking for flight tickets, as prices were “just so high,” that she couldn’t justify the cost, she told CNBC in an interview — a surge in fuel prices caused by the fallout from the Iran war has seen airfares rise. Bui found that flight tickets, including layovers, from Vietnam to the Middle East, had reached about $1,500 to $2,000 in March.

Many travelers cited non-refundable fare change fees as a top cancellation trigger, Jay Ellenby, president of Safe Harbors travel group, said in an email. There was a noticeable 20-30% uptick in cancellations for Middle East routes from the travel agency’s Asian clients, with many quoting $450 non-refundable fare change fees on international trips being a top cancellation trigger.

Instead, these travelers were pivoting to Southeast Asian hubs like Singapore or intra-Asian routes, Ellenby added.

Booking platforms have been collating user data to create more effective suggestions for travelers stuck in transit or in ticket planning limbo.

Instead of needing to have multiple booking tabs open, travel websites have been looking to help shoppers find quick solutions, according to Maurizio Garavello,…

Federal Reserve Chair Jerome Powell says he will keep serving as head of the central bank if his nominated successor, Kevin Warsh, is not confirmed by the time his term is up in May, as dictated by the law.

Separately, Powell said he will not leave his Board of Governors position, which technically extends until early 2028, until the Department of Justice investigation of him is “well and truly over with transparency and finality.”

Powell said during his Wednesday press conference that he would serve as “chair pro tem” if Warsh, President Donald Trump‘s pick to take over the role, has not been greenlighted by the Senate. That follows precent done in several past scenarios, Powell said.

The Fed chief’s position on the Board of Governors is separate from his chairmanship. Powell said he wouldn’t exit the board until the Justice Dept. probe has been resolved, and hasn’t decided if he would depart before his term as Fed governor ends in early 2028.

“I have not made that decision yet,” Powell said. “I will make that decision based on what I think is best for the institution and for the people we serve.”

The Federal Reserve Act says that if a chairman and vice chairman are absent, then the Board “shall elect a member to act as chairman pro tempore.”

Powell wants to avoid any appearance that he was pushed off the board because of political pressure.

A federal judge last week blocked grand jury subpoenas issued as part of Powell’s criminal investigation. The decision was viewed as a major win for Powell, whose probe has become a political lightning rod within Trump’s Republican party.

Critics deemed the investigation as part of a broader, politically motivated pressure campaign on Powell and the institution, with the goal of having him lower interest rates or resign. Sen. Thom Tillis, R-N.C., said he would block the confirmation of Warsh until the federal investigation ends.

U.S. District Judge James Boasberg said in his ruling that the Justice Department didn’t have proper purpose for the subpoenas. The government has shared “essentially zero evidence” that Powell committed a crime, the judge said.

“A mountain of evidence suggests that the Government served these subpoenas on the [Fed’s] Board to pressure its Chair into voting for lower interest rates or resigning,” Boasberg wrote.

U.S. Attorney for the District of Columbia Jeanine Pirro said the Justice Department would appeal Boasberg’s ruling, which she called “outrageous.”

“Jerome Powell is now bathed in immunity,” she said in a news conference. “This is wrong, and it is without legal authority.”

The Fed on Wednesday opted to keep interest rates unchanged, citing concern over higher-than-expected inflation and uncertainty around the ongoing U.S.-Iran war. Trump has been vocal, including comments as recent as this week, that the Fed…