The Fed looks set to raise interest rates this week for the first time since 2023, which is bad news for borrowers, for the government's debt bill, and for Trump politically.

• Inflation has run above the Fed's target for more than five years and picked up again in August, pushing Goldman Sachs, JP Morgan, and most economists to expect a quarter-point hike.
• Trump has publicly told his own pick for Fed chair, Kevin Warsh, not to raise rates, arguing the US should borrow at the lowest rates in the world.
• The real driver is energy: the Iran war has choked the Strait of Hormuz, Yemen's Ansar Allah has closed the Bab el-Mandeb, and a major Saudi pipeline carrying 7% of world oil supply is now shut down.
• Diesel just hit a record above $6 a gallon and heating costs are set to jump this winter — up 31% for homes running on heating oil.
• Trump blames Ukraine's strikes on Russian refineries and says both sides agreed to stop hitting energy targets; Ukraine denies any such deal.

Outlook: A hike would break Trump's core promise of cheap money heading into the midterms, and more increases are expected before spring unless energy prices cool.