raises

Kosovo faces the risk of turmoil as protests against the convictions of former Kosovo Liberation Army (KLA) leaders coincide with a midnight deadline to elect a president.

Demonstrators have called for changes to the law governing the Hague-based Kosovo Specialist Chambers, including measures affecting prison terms and where convicted people serve their sentences. The protests follow the September 16 convictions of former KLA leaders, including former President Hashim Thaci.

The protesters’ demands have become entangled with negotiations over the presidency, raising the prospect of new elections if lawmakers fail to reach an agreement. November 15 has emerged as a likely date for a new vote.

“New elections do not, in themselves, promise anything particularly positive,” political analyst Artan Muhaxhiri told Al Jazeera. “The chances of a radical political change are slim.”

He said that if a president is not elected by midnight, a new vote will take place in a tense political climate.

Anger over the verdicts will become a central campaign issue, he said, “overshadowing fundamental questions of socioeconomic development, and deepening the country’s downward spiral of systemic instability”.

How did Kosovo get here?

In 2015, the Specialist Chambers were established under Kosovo law following international investigations into alleged war crimes committed by KLA members during and after the 1998-99 conflict. Although formally part of Kosovo’s judicial system, the court sits in The Hague. It remains contentious in Kosovo because the KLA is widely revered for having fought against Serbian rule.

In September, protests erupted after the court sentenced Thaci to 25 years in prison.

Later, the opposition Democratic Party of Kosovo (PDK) – formerly led by Thaci – proposed amendments aimed at curbing the tribunal. The plan included capping prison sentences at 15 years, allowing convicts to serve their sentences in Kosovo, enabling appeals before Kosovo’s Supreme Court, granting presidential pardons and narrowing the court’s temporal jurisdiction.

On October 2, 2026, Prime Minister Albi Kurti’s government concluded that there were no legal obstacles to the PDK initiative and forwarded its assessment to the parliament, the Assembly of Kosovo. Days later, Kosovo’s parliament approved the initiative at first reading with 91 votes in favour, although it has not been finally adopted.

Meanwhile, Kosovo has been mired in a political impasse after the expiration of President Vjosa Osmani’s term in April, as the National Assembly has been unable to select a new president.

Now, internal power struggles within the PDK following the September sentencing have left the party fragmented, rendering the largest opposition party incapable of negotiating a cross-party presidential compromise, according to Nexhmedin Spahiu, a Pristina-based professor of political science.

On Monday, as lawmakers failed to secure a quorum to elect a president, police deployed tear gas and water cannon outside the Assembly, following confrontations involving fireworks and bottles. The use of force prompted criticism from observers.

Tensions rise

Pristina-based journalist Gezim Baxhaku believes special police units overstepped their legal authority.

“There was an overuse of force,” Baxhaku told Al Jazeera. He said that while protesters threw firecrackers, police “exceeded their legal powers and acted entirely contrary to the situation on the ground”.

Among the hundreds of protesters were KLA veterans.

Pristina had witnessed nearly three weeks of largely peaceful gatherings before Monday’s escalation.

“Citizens were routinely bringing food, water, and coffee to the officers on duty,” Baxhaku said. “There was absolutely no reason for this to happen. For the first time since the late 2000s, police acted in such an uncalled-for manner – reacting upon orders to escalate a situation.”

Spahiu, the political science professor, said the protests should not be understood as a sign that people in Kosovo broadly reject the verdicts.

“A large majority of citizens in Kosovo are satisfied with the decision of the Specialist Chambers in The Hague,” said Spahiu.

He told Al Jazeera that the court’s rejection of Serbian claims of systematic crimes against humanity by the KLA “validated the liberation struggle”.

“Furthermore, people are relieved that individuals are finally being held accountable for crimes committed against political rivals within the Albanian community itself,” he said.

The political deadlock and Kurti’s ‘transactional’ approach

The Assembly remains deadlocked over the election of a head of state, as the PDK and other opposition parties boycott the voting session, denying the legislature its constitutionally required 80-MP quorum.

Muhaxhiri blamed Kurti for the crisis, criticising his decision to link the presidential vote to the Hague court amendments.

“Tensions escalated further when Kurti presented a plan based on a transactional approach to two fundamentally distinct issues: linking the draft law amending the Law on the Specialist Chambers to the election of the new president,” said Muhaxhiri.

“In effect, this amounted to a quid pro quo. By doing so, he appeared to be placing the historical, national, and identity-related significance of the liberation war on the same political bargaining table as the immediate objective of electing a president who would serve his political interests.”

Reserve Bank of Australia lifts benchmark rate to 4.6 percent amid stubborn inflation.

Australia’s central bank has raised interest rates to a 15-year high, spelling higher mortgage payments for millions of Australian households.

The Reserve Bank of Australia (RBA) on Tuesday lifted the benchmark rate by 0.25 percent to 4.6 percent, its highest since 2011.

The RBA said inflation remained elevated and that previously flagged “upside risks” had materialised, including higher energy prices due to the United States-Israel war on Iran and rising tech costs.

“There continue to be heightened uncertainties about the outlook for domestic economic activity and inflation,” the bank’s monetary board said in a statement.

“The Middle East conflict remains unresolved, and there are scenarios where inflation is higher and activity lower than forecast,” it said.

“Global oil supply disruptions are maintaining upward pressure on global and domestic energy prices and inflation. A period of prolonged uncertainty may also cause growth to be lower overseas and in Australia.”

Australia’s annual rate of inflation stood at 3.5 percent in July, well above the central bank’s 2–3 percent target.

Central banks typically raise their benchmark interest rate when policymakers believe prices are rising too fast.

Higher interest rates raise the cost of borrowing, including mortgages, cooling consumer demand and bringing down inflation.

The latest hike is set to heap further strain on Australian households already grappling with three previous increases this year.

In a research report earlier this month, Roy Morgan said nearly one-third of Australian mortgage holders, or nearly 1.8 million people, were at risk of “mortgage stress” – where households spend 25-45 percent of after-tax income on payments – as of July.

Australia’s Treasurer Jim Chalmers, who is not responsible for setting interest rates, acknowledged that the hike would mean greater hardship for many Australians.

“We know a lot of Australians are under pressure and this will make things harder,” Chalmers said in a post on X.

“Inflation and interest rates are going up around the world but we know that doesn’t take the sting out of today’s decision.”

Chalmers said the government would take responsibility for “our part of the fight against inflation”.

“That means continuing to manage the budget responsibly, rolling out tax cuts and cost of living help, and addressing the longer term challenges in our economy in an uncertain global environment,” he said.

Repeated blasts at military sites expose the risks facing Syria as it rebuilds its army and consolidates weapons after years of war.

A series of explosions at weapons and ammunition sites across Syria this month have exposed the difficulties facing the country’s military in storing and moving munitions, as the armed forces rebuild after more than a decade of war.

The latest blasts injured at least four people in the early hours of Monday morning at an arms depot in al-Eis, south of Aleppo.

On Friday, a blast in Ayyash, west of Deir Az Zor, killed 11 soldiers. Another on September 9 killed 14 defence ministry personnel in Sarmada, Idlib. Also in Idlib, five people were killed when a vehicle carrying ammunition exploded in the town of Binnish on September 1 .

According to a tally by the Reuters news agency, at least 16 similar explosions have hit arms storage facilities since the fall of long-time President Bashar al-Assad in December 2024 after an opposition offensive.

Some have been attributed to poor storage conditions. The Syrian Defence Ministry said it is investigating the causes behind the recurrent explosions to prevent future incidents.

Long-time neglect

Security analysts are divided on the root causes, with some pointing to a lack of professional infrastructure and others highlighting the potential for foreign interference – although there is as yet no hard evidence for that.

Omer Ozkizilcik, a nonresident senior fellow for the Syria Project in the Atlantic Council’s Middle East Programmes, explained to Al Jazeera that the Syrian military is undergoing a period of huge change. It is reorganising from what it was under al-Assad, consolidating weapons from different sources and integrating various forces. All of that could be putting pressure on Syria’s storage infrastructure, which was already creaking after the long war and international isolation.

“The explosions could have happened due to neglect, Ozkizilcik said. “The Syrian army is receiving much more military aid than ever before. It gained control over the stockpiles of the former regime and the formerly US-backed [Syrian Democratic Forces]. The increase in quantity coupled with the need to protect weapons from potential Israeli airstrikes may have pushed the Syrian army to store weapons in inadequate places.”

Ozkizilcik emphasised that Syria’s military is still in a transitional phase. The former army was dissolved after the fall of the al-Assad regime and fighters from armed opposition groups were integrated into a new military structure. Damascus has also been working to integrate territory and forces previously controlled by the Kurdish-led SDF.

“The Syrian army has yet to become a professional army,” Ozkizilcik added. “These explosions are not the first that happen in Syria. Before the fall of al-Assad, similar things happened many times in Syria. [but] I don’t think these explosions will affect Syria’s military capabilities in any visible way. It’s merely a loss of some stockpiles that can be replenished.”

Weapons and ammunition, by their nature, need to be handled extremely carefully and stored properly. Storing large quantities of ageing ammunition for years in poor conditions, such as high temperatures or humidity, can accelerate their deterioration and lead to them becoming unstable.

“The current warehouse infrastructure suffers from severe ageing; most of it dates back decades and does not meet international safe storage standards,” said security expert Ismat al-Absi. “Storing ageing munitions in open or semi-closed environments without controlled cooling and humidity systems creates what we call a thermal runaway chain reaction.”

Possibility of sabotage

The repeated explosions have led to some fears of sabotage, particularly in light of repeated Israeli attacks against Syria since the fall of al-Assad, many of which have targeted the military, including the August strikes on the Abu al-Duhur airbase in Idlib.

Ozkizilcik noted that there was “no public information about possible sabotage” being behind the weapons depot explosions, and no evidence of any direct Israeli links. But the repeated explosions, coupled with Israel’s attacks in Syria and past intelligence operations against groups like Lebanon’s Hezbollah, mean it cannot be totally ruled out.

“Considering that the Israeli media recently wrote about the growing military capabilities of Syria, suspicions grow,” he said.

Al-Absi told Al Jazeera that the wide geographic scope of the explosions nevertheless meant that deliberate interference should be investigated.

“The main loopholes that [could have allowed sabotage operations] are the absence of smart surveillance, relying on traditional human guarding instead of remote sensors and thermal movement detection; weak securing of transport lines and administrative fragmentation,” al-Absi said. “The weakness of security discipline during the restructuring phase of the military institution has made some sites vulnerable to penetration or internal manipulation.”

Bank of Japan raises benchmark interest rate from 1 to 1.25 percent, pledging to help counter inflation risks.

The Bank of Japan (BoJ) has raised interest rates by 0.25 to 1.25 percent, pushing borrowing costs to their highest level in 31 years, amid rising inflation and wages, and pressure from Washington.

The move on Friday marked the first hike since June, and takes interest rates closer to levels the BoJ deems neutral to the economy, marking another step away from decades of ultra-low rates that cemented the yen’s status as a cheap global funding currency.

Japan is grappling to contain inflation, which is being driven by factors including rising energy prices, global supply pressures and domestic inflation exceeding the 2 percent target.

Core consumer inflation held steady near the target in August, data showed on Friday, as companies continued to pass on rising costs for a wide range of food and grocery items.

The country also faced a “slow-moving demographic shock” with a shrinking labour pool lifting wages, a structural factor that ⁠cannot be dismissed as temporary, BoJ Executive Director Koji Nakamura said on Monday.

The Federal Reserve’s rate hike on Wednesday, and the prospect of another one later this year, have added pressure on the BoJ to keep pace.

Further widening of the United States-Japan rate gap risks weakening the yen and lifting inflation through higher import costs, analysts told the Reuters news agency.

Its policy rate also remains lower than the European Central Bank, which raised its key rate to 2.5 percent last week.

Such pressure could affect the tone of BoJ Governor Kazuo Ueda’s post-meeting briefing, which will be closely watched by markets for clues on the timing and pace of further increases.

WASHINGTON, United States: The US Federal Reserve on Wednesday raised interest rates for the first time since 2023, defying President Donald Trump’s demand for cuts, as central bank chief Kevin Warsh stressed the need to combat inflation that has been “too high” for “too long.”

The Fed’s Federal Open Market Committee voted unanimously to raise rates by 25 basis points to between 3.75 and 4.00 percent, saying the rate hike would support a “timelier return” to its two-percent target for inflation.

Warsh, appointed by Trump, said the decision was a “serious” one, but needed to be taken.

“The plain fact is that inflation is too high, and has been for too long,” he told a press conference.

And Wednesday’s rate hike may not be the last — the vast majority of Fed policymakers indicated that at least one more rate hike was likely necessary before the end of the year, according to their Summary of Economic Projections.

US households and businesses have been battered by years of higher-than-target inflation, and prices have surged in the wake of Trump’s war on Iran, his signature tariff policies and the ongoing AI boom.

Trump has launched an unprecedented assault on the Fed’s independence since taking office, attempting to fire a Fed Governor and launching a criminal probe against Warsh’s predecessor in his quest for lower rates to spur economic activity.

The president’s Republican Party faces a stern test in upcoming midterm elections, with rival Democrats seeking to wrest control of both houses of Congress and economic issues front-and-center for voters.

Growing calls for hike

The Fed has held rates steady since January, choosing to wait to gauge the effects of the Iran war’s energy price shocks and to let the impact of tariffs on prices ripple through the economy.

Since July, however, a growing faction of policymakers had indicated a rate hike may be required to tame inflation, as the war grinds on and prices remained elevated.

On Friday, August’s consumer price index came in at 3.4 percent — unchanged from the month before, but still well above the Fed’s long-term two-percent target.

In its SEP, the Fed raised its forecast for its preferred gauge of inflation — the Personal Consumption Expenditures (PCE) price index — by 0.1 percentage points to 3.7 percent by year-end.

The Fed also raised its projection for GDP growth by year-end to 2.3 percent, up 0.1 percentage points.

‘Rather unfortunate’

US stock markets largely priced in Wednesday’s rate hike, but they were still down on the news — expected with any rate hike as equities become less attractive.

Yields on 10-year US Treasury bonds — which have surged in recent days as uncertainty on long-term inflation has spiked — were also up past the five-percent threshold.

Following the Fed’s announcement, White House spokesperson Kush Desai said the decision was “rather unfortunate” and that Trump had been clear that he wanted lower interest rates.

Warsh was named to his position after a contentious Senate confirmation process, where Democratic lawmakers accused him of being a “sock puppet” for Trump, which he denied.

So far, Trump has supported Warsh, claiming that the Fed chair wants lower rates and accusing the board of being “political.”

The Fed has a dual mandate to deliver maximum employment while keeping inflation to its long-term two-percent target.

It mainly achieves these goals by setting the key US interest rate — lower rates tend to spur economic activity but fuel inflation, and hiking them cools both activity and prices.

The Fed’s SEP showed that at least 12 of 18 policymakers who participated in the projection expected one more rate hike would be required before the end of the year.

Four policymakers expect two more rate hikes to be required.

Warsh has criticized the Fed’s policy of offering such projections in the past and did not participate in the previous iteration in June.

This projection also included only 18 policymakers, suggesting he had once again withheld his contribution.

Kevin Warsh has broken away from US President Donald Trump in his first Fed move, and he has done it with the entire committee behind him.

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The Federal Open Market Committee lifted rates on Wednesday after holding them at 3.5% to 3.75% since December, ending a pause that had grown harder to justify as energy costs pushed prices higher.

Not a single member dissented in a unanimous 12-0 vote.

That matters because the pressure ran in both directions as three regional presidents had voted for a hike in July, while the White House spent months demanding cuts.

Nobody voted for either extreme.

At the time of writing, the market reaction to the decision has been fairly muted likely due to the fact that the hike was widely expected.

A statement stripped to the bone

The Fed’s communication was as striking as its decision.

The statement ran to three short paragraphs, a fraction of the length markets are used to, with no forward guidance and no hedging.

“Inflation remains elevated,” it read, adding that “today’s policy action will support a timelier return to the Committee’s 2 percent goal.”

The word “timelier” carries an implicit admission that the return had been too slow.

Then a sentence the Fed almost never writes: “The Committee will deliver price stability.” Not seeks to, not is committed to. Will.

The economic assessment was also confident throughout.

Activity is “expanding at a solid pace”, domestic spending “has been resilient”, productivity growth is “strong” and capital investment “robust”, while job gains “have kept pace with the workforce”.

Uncertainty remains elevated, the Fed said, owing partly to “geopolitical developments”, its formulation for the Iran war.

By describing an economy in good health, the committee removed the argument that higher rates would damage growth, which is precisely the case US President Donald Trump has been making.

Boxed in by the data

The decision had been building for months.

Three regional Fed presidents dissented in July in favour of an increase, the most in one direction since 2016, and several others said afterwards they were ready to move unless inflation eased which it did not.

The Fed’s preferred gauge, the personal consumption expenditures index, ran at 3.7% in both June and July, with core inflation at 3.3%. Before the Iran war sent fuel prices climbing, core stood at 3%.

Consumer prices held at 3.4% in August, but the monthly increase of 0.4% was the sharpest since May, evidence the energy shock is feeding through. Inflation has now been above the 2% target for more than five years.

Warsh had effectively committed himself at Jackson Hole in August, telling the symposium he “would be hard pressed to describe broad financial conditions as restrictive” and warning that unless underlying inflation moved to target “clearly and at sufficient speed”, the Fed had “work to do”.

Markets took him at his word as the CME’s FedWatch tool put the probability of a rate hike above 90% before today’s decision.

Defying the president who chose him

US President Donald Trump had spent months demanding the opposite, insisting the country should have the lowest interest rates in the world and choosing Warsh partly on the expectation he would deliver them.

Warsh himself said while campaigning for the job that rates could come down.

The treatment of his predecessor sharpened the stakes as Jerome Powell was publicly attacked for moving too slowly, and the US Justice Department opened a criminal investigation into testimony he gave to Congress.

Today’s decision could also have a restoring effect on the perceived independence of the Federal Reserve as an institution.

The technical details point to a Fed settling in at the new level.

The interest rate on reserve balances rises to 3.90% from Thursday, the primary credit rate to 4%, and standing repurchase operations will run at 4%. Seven regional reserve banks requested the discount rate increase.

The Fed’s new dot plot shows 12 of 18 officials expect another 0.25% hike by year-end, taking rates to 4.125%, while four see rates reaching 4.375%.

The hawkish signal extends well beyond 2026 as 14 officials see rates ending 2027 above today’s level, while the 2028 median stands at 3.9% versus 3.4% expected.

The longer-run rate also rose to 3.2%, suggesting officials increasingly believe neutral rates have moved higher while economists also expect more to follow.

DEVELOPING STORYDEVELOPING STORY,

The 25 basis-point hike is the first raise in three years and comes ahead of critical midterm elections in the United States.

The United States Federal Reserve has said it will raise interest rates by a quarter of a percentage point as inflation, driven by soaring fuel prices amid the US-Iran war, continues to weigh on the economy.

The Fed, which is the central bank of the US, said on Wednesday that it will hike interest rates by 25 basis points to 3.75 percent to 4 percent.

It is the first hike in more than three years and comes just weeks before the US midterm elections, despite repeated demands from US President Donald Trump to lower rates.

“Economic activity is expanding at a solid pace. While uncertainty remains elevated owing, in part, to geopolitical developments, domestic spending has been resilient,” the Fed said in a statement on Wednesday.

“Inflation remains elevated. Today’s policy action will support a timelier return to the Committee’s 2 percent goal. The Committee will deliver price stability.”

After Wednesday’s hike, Fed officials expect one more rate increase this year, according to their quarterly projections.

CME FedWatch, which tracks the likelihood of monetary policy decisions, forecast a 92.3 percent chance of the Fed increasing rates to 3.75 to 4 percent. A week ago, that forecast was a 40 percent chance of a quarter-percent rate increase.

But in the days since, a slew of data shifted those expectations.

For one, consumer prices jumped in August by 0.4 percent, the highest increase in four months. On an annual basis, prices rose 3.4 percent, matching the increase recorded in July, while the job market remains healthy.

Since then, benchmark crude oil prices have continued to soar as strikes in the US-Israel war on Iran have intensified. Brent crude hovered near $109 per barrel on Tuesday.

The average price for a gallon (3.8 litres) of petrol is $4.36, up 14 cents in the past week, and up from $4.06 in the last month, according to the American Automobile Association (AAA), which tracks daily petrol prices.

Diesel, on the other hand, was at $6.31, the highest recorded average and roughly double from a year ago. That, in turn, is expected to further stoke prices as diesel is used in trucks to haul everything from fruits and vegetables to steel and cement.

At the same time, the benchmark 10-year Treasury yield broke above the psychologically important 5 percent threshold on Tuesday, hitting 5.02 percent, its highest level in 19 years. The yield serves as a benchmark for borrowing costs, including car loans and home mortgages, and is a bellwether for inflation.

“The economy is in an unusual place,” Michael Klein, professor of international economic affairs at Tufts University’s Fletcher School and executive editor of EconoFact, a nonpartisan economic and social policy publication, as unemployment remains at a comfortable level while higher prices continue to stick, sending inflation beyond the Fed’s target of 2 percent.

“There [has been] a lot of pressure on Chairman Warsh to raise interest rates because of inflation coming in high, and that has been compounded by concerns about Trump’s pressure” as the president has continued to demand that interest rates be lowered, Klein said.

“Higher interest rates tend to weaken the economy… but if the market believes that there’s going to be a rate increase, it’s priced in already as prices move on news, so this won’t be news,” Klein said, adding that should help steady yields.