Central bankers from Europe and the UK are arriving in Jackson Hole, Wyoming this week for the Federal Reserve’s annual conference. While they will undoubtedly do the usual swapping of research papers, some are also preparing to be surprisingly vocal in defense of Fed chair Jerome Powell.

Powell has faced relentless attacks from US President Donald Trump for refusing to cut interest rates. Trump has also pledged to replace Powell next year when his term as chair expires with someone more compliant.

Among those making the trip to the Teton Range are European Central Bank President Christine Lagarde and Bank of England Governor Andrew Bailey. They are expected to voice strong support for Powell and warn of the dangers that come when elected officials put pressure on monetary policymakers.

“Independence is part of the DNA of central banks,” Bundesbank President Joachim Nagel told Bloomberg News. “It would be more than desirable if this were recognized everywhere.”

The president escalated attacks today by demanding the resignation of Fed Governor Lisa Cook, after the administration accused her of mortgage fraud. Cook was nominated to the Fed by former President Joe Biden.

The offensive has rattled policymakers from around the world, raising fears that central-bank independence — seen as essential to keeping inflation in check — could be undermined. — Jennifer Duggan

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The euro-zone economy is likely to see slower growth this quarter, with question marks over global trade remaining despite recent deals with the US which aimed to reduce uncertainty, ECB President Lagarde said. Speaking in Geneva, Lagarde said the 15% tariff now in place for most European goods is a little above the level the ECB assumed in June but “well below” a severe scenario it had also mapped out. The comments are Lagarde’s first since the European Union struck its pact with Trump.

Citigroup hired law firm Paul Weiss to investigate complaints about the behavior of the bank’s wealth-management chief, Andy Sieg, who was brought on by Chief Executive Officer Jane Fraser as a high-profile hire to drive a key part of her turnaround plan. Sieg, on a quest to shake up Citigroup’s wealth business, has drawn complaints from current and former staff accusing him of intimidating and unfairly sidelining employees since he arrived almost two years ago, according to people familiar. 

Cooler conditions are helping Spanish and Portuguese firefighters tackle deadly blazes that have forced tens of thousands of people to flee over the past two weeks. The shift in the weather since Monday has reduced wildfire risks, after a 16-day heat wave seared the region. Still, 22 fires are burning across Spain, and there are four major blazes in Portugal, where stronger winds are fanning the flames in coastal and mountainous areas.

UK Chancellor of the Exchequer Rachel Reeves is considering taxing high-value family homes as she looks for ways to plug a multibillion-pound hole in the upcoming budget. The move would make expensive primary properties subject to capital gains tax, ending a long-standing exemption, according to a person familiar. The Times was first to reported the proposal, dubbing it a “mansion tax.” Reeves is under pressure to raise as much as £51 billion ($69 billion) at the budget to a fill hole that has opened up since the March spring statement and preserve the £10 billion buffer against her fiscal rules. 

Rachel Reeves Photographer: Pool/Getty Images Europe

Kenya is in talks with China to convert dollar-denominated debt owed to its biggest bilateral lender to yuan and extend the repayment period, Treasury Secretary John Mbadi said. The negotiations are aimed at helping reduce the $1 billion Kenya spends annually on servicing its debt to China, and to create more wiggle room in its budget, he said in an interview in the capital, Nairobi today. The discussions are expected to conclude soon, Mbadi said, without providing a more specific timeframe.

John Mbadi, Kenya's treasury secretary, during an interview in Nairobi, Kenya. Photographer: Kang-Chun Cheng/Bloomberg

An overhaul in the Dutch pension fund system is already having an impact on the multi-trillion euro swaps market. For years, Dutch pension funds’ high demand for funding hedges caused an unusual distortion — it was more expensive to hedge over three months than six months. In a normal market, it should usually be cheaper to protect against price swings over a shorter time span. But now, as the Netherlands pushes through pension changes, that dynamic has shifted and those hedging requirements have been reduced.

Plagued by failed test flights, Elon Musk’s space company is under pressure to show progress in its massive rocket program. SpaceX’s impressive track record has had a deep impact on the space industry and US space policy.  Since its inception, SpaceX has made highly visible test flights that sometimes fail in spectacular ways something of a calling card. Its process is designed to learn from failures fast. Yet Starship’s recent struggles are revealing how rapidly updating rockets that cost hundreds of millions to make can lead to a cascade of expensive issues.

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