Reuters World News - Pentagon, Powell, Walmart, DC troops and Gaza's children

Episode Date: August 23, 2025

The Pentagon’s intelligence chief has been fired in the latest purge by President Donald Trump's administration. Fed Chair Jerome Powell hints at a rate cut in September. Walmart’s earnings reveal shifting consumer behavior under Trump’s tariff policy. National Guard presence alters Washington DC’s tourist season. And Gaza’s children face starvation as aid struggles to meet demand.  Listen to ⁠⁠⁠⁠On Assignment⁠⁠⁠⁠ podcast here. Sign up for the Reuters Econ World newsletter ⁠⁠⁠⁠here⁠⁠⁠⁠. Listen to the Reuters Econ World podcast ⁠⁠⁠⁠here⁠⁠⁠⁠. Find the Recommended Read ⁠⁠⁠⁠here⁠⁠⁠⁠. Visit the Thomson Reuters Privacy Statement for information on our privacy and data protection practices. You may also visit megaphone.fm/adchoices to opt out of targeted advertising. Learn more about your ad choices. Visit megaphone.fm/adchoices

Today, the head of the Pentagon Intelligence Agency is fired. Fed Chair Powell says they may need to cut rates next month. What Walmart's results say about the American economy? How National Guard troops are transforming the summer tourist season in Washington, D.C., and we hear from families on the ground in Gaza struggling to feed their children. It's Saturday, August 23rd. This is Reuters World News, bringing you everything you need to know. from the front lines in 10 minutes, seven days a week.

I'm Tara Oaks in Liverpool. The head of the Pentagon's Defence Intelligence Agency has been fired. While it's not clear exactly why Lieutenant General Jeffrey Cruz was removed, it comes after the leak of a preliminary assessment that found that US airstrikes on Iranian nuclear facilities only set Tehran's program back a few months. That contradicts President Donald Trump's claims of total ablimate. President Trump has announced that the US will take a nearly 10% stake in Intel,

purchasing shares at a discount to help the struggling chipmaker. The deal converts existing government grants from the Biden-era Chips Act into equity, ensuring Intel receives funding for US factory construction. Jerome Powell's speech at the Jackson Hole Economic Symposium hinted at a rate cut next month, but the Fed chair was careful not to reveal much more. We caught up with our Fed reporter Howard Schneider, who's on the ground in Wyoming. He's got two pretty strongly held bodies of opinion. He's trying to manage on the Fed right now, one that's focused on rising inflation,

another that sees the job market potentially weakening, job growth slowing, economic growth, slowing, and that all potentially reinforcing itself in a bad way for the unemployment rate. So he clearly opened the door for a rate cut in September. Remember, September is one of the meetings where they will release quarterly economic updates. So we'll get a very nice mark to market there of where the sort of core of the committee feels rates are heading from September forward. Powell's remarks got a swift backlash from President Trump, who contends there is no risk of inflation and that the Fed should slash rates immediately. While investors carefully watched Powell's speech, Walmart released earnings this week, reporting strong growth in stores and online. Ruttled by tariffs and persistent inflation, shoppers have flocked to the low-cost retailer in recent months. David Gaffin is our U.S. companies editor and has been looking into what Walmart's finances say about the U.S. economy.

So Walmart's, of course, the largest retailer in the world. And it's been in something of a sweet spot when it comes to tariffs, the rising conditions. about inflation and overall weakness in consumer sentiment. You've had higher income customers, people who would frequent other types of stores, going to Walmart more. So they're benefiting from that. They source a lot of stuff domestically, and that's not affected by tariffs. So they lean heavily on groceries.

Most of our food is produced in the United States. And the reality is that the U.S. consumer has been relatively resilient. There's been some ebbing of consumer spend, some concern about, prices, but that hasn't quite translated into any kind of real falloff, part of which is the result of the fact that half of the nation's consumer spending now comes from about the top 10% in terms of income. Walmart was one of the first retailers to signal that they may have to increase prices due to Trump's tariff policy. David says that's only now beginning to hit the store level. A lot of retailers, including the likes of Walmart, Target, Amazon, brought in goods very aggressively

in the first half of the year in response to Donald Trump's trade policy. And so they brought a lot of stuff into the United States and were able to sell that pretty much at the prices that they wanted to. That period is waning now. Walmart made that very clear. And there will be additional inflation that comes through in the second half of the year. We're ready. We'll go ahead and we'll straighten out Chicago, just like we did D.C.

Chicago's very dangerous. Great place. President Trump threatening to expand the use of federal agents. and military forces in other Democrat-led cities to address what he calls a crime epidemic. This comes after the deployment of 2,000 National Guard troops in Washington, D.C., aimed at addressing crime in the nation's capital. Trump's even threatened to take full control of Washington, D.C.

Our reporter Tim Reed is in D.C. And has been covering the military presence on the streets. Along the National Mall, where the Lincoln Memorial and the... the Washington Monument is and all the museums, and it's where all the tourists hang out during the summer months. There were several hundred National Guard troops just wandering around them all in groups of four and five, quite often taking selfies with tourists. Some of them would go up to food trucks and buy ice creams or slushies. I even spoke to one National Guardsman, and he

even admitted that they were a bit bored and really weren't doing anything. Tim says, beyond the visual presence, the impact on crime in D.C. has been less clear. They have been bought to Washington, D.C., officially, according to Donald Trump and other officials, to help fight what President Trump calls a crime epidemic in Washington, although crime rates are actually down compared to previous years. But they are not actually authorized as yet to arrest anybody. Meanwhile, I also went over to Ward 8. It's the neighbourhoods or neighbourhoods in Washington that have the highest crime rates. Now, while federal and local police are making arrests in that area every night,

there's not a single National Guard troop has been deployed to this area. And I spoke to some of the residents in Ward 8, who said they'd actually welcome National Guard troops on their streets to help improve the crime there. But there are no soldiers there at all. As we reported in yesterday's podcast, Gaza City and surrounding areas are officially suffering from famine according to a global hunger monitor. On the ground, families are struggling to feed their children,

even as aid trucks cross the border. Aisha Wachtan, a mother of an eight-month-old boy, describes how she tries to keep her son fed with herbs when baby formula runs out. The senior correspondent Nidal al-Megrabi has been speaking with mothers, doctors and aid workers inside Gaza. The reality is very difficult. We have families who are living on one meal a day. Other families who cannot find bread for their children.

Speaking to at least four mothers in the past 10 days say that they cannot breastfeed their children because they are not fed themselves. If a mother cannot breastfeed like her child, she'll be depending on other materials like milk powders, but they also say that it's very expensive, it will be sold at unbelievable prices that many of them cannot afford. Nudal spoke about the challenges of getting food and aid into the enclave. The United Nations and Palestinian officials both say what's coming and what's being allowed by Israel is far from sufficient. The Israeli full ministry criticized the report and they said there is no famine in Gaza. Israel is accusing Hamas of stealing aid, an allegation or a charge the Hamas organization have always and repeatedly denied food experts and board officials.

They all agree that only sustainable flow of aid and commercial goods can help overcome the problem, but you cannot eliminate the problem of famine. and starvation because you will need qualitative food to enter, like meat, chicken, eggs in big quantities, and every day. The Justice Department has released an interview with Gillesne Maxwell, the former girlfriend of Jeffrey Epstein, who is serving a 20-year sentence for sex trafficking. The publication of the interview comes as Trump has faced criticism over the DOJ's decision not to release to files from its Epstein investigation.

According to the July transcript, Maxwell told a top DOJ official that she never saw President Trump in any inappropriate setting. Today's recommended read takes us to Tennessee, where thousands of former US nuclear employees are battling illnesses linked to radiation exposure. The government program meant to help them is in limbo

after the suspension of a key medical review board. And if you haven't yet, check out the latest episode of our On Assignment podcast. This week's is Inside Congo's Mines, a journey through contested terrain containing vital minerals for your everyday life. For more on those or any of the stories from today, check out reuters.com or the Reuters app. Don't forget to follow us on your favourite podcast player,

and if you're listening on a smart speaker, just ask for the latest news from Reuters, seven days a week. We'll be back tomorrow with our daily headline show.