The EU Opens Its Arms to Canada

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Luke Vargas (0:34)

The EU's top executive floats making Canada the bloc's first associate member. Plus, we'll get the details as the US burns through its interceptors to counter Iran.

Jared Malsin (0:46)

The US military fired 60 to 70 of its Patriot interceptors in a span of about two days last week. That's more than 10% of one year's worth of production depleted in a single attack.

Luke Vargas (0:59)

And our Nick Timouros walks up to one of the most consequential Fed rate decisions in recent memory. It's Wednesday, September 16th. I'm Luke Vargas for the Wall Street Journal. And here is the AM Edition of What's News, the top headlines and business stories moving your world today.

The EU is opening its arms to Canada. European Commission President Ursula von der Leyen this morning invited Canada to become the bloc's first ever associate member, praising their shared values and promising to build a shared future as well. Von der Leyen said that the two sides would build on an existing free trade agreement with partnerships spanning AI, critical minerals, the Arctic and a range of other issues.

Ursula von der Leyen (1:46)

This is not a partnership against anyone else, but for our common strength.

Luke Vargas (1:53)

Canadian Prime Minister Mark Carney is set to address the EU Parliament tomorrow. Our reporting earlier this week suggested the new relationship could include visa-free travel as well as the free movement of goods and people working in critical industries to secure supply chains.

Well, Von der Leyen used her State of the European Union speech this morning to break some other news as well, proposing to ban children under 13 from accessing social media, online games and chatbots.

Ursula von der Leyen (2:21)

I am aware that many perceive the power of big tech as overwhelming and impossible to roll back. I disagree.

Luke Vargas (2:28)

Under her proposal, Von der Leyen said the kids aged 13 to 15 could access mini accounts chaperoned by guardians. The EU's 27 member nations would need to approve the measures, which if passed could raise the eyer of President Trump, who's long criticized European tech regulations.

It's Fed Day, and quite possibly the most closely watched rate decision of the year. Sticky inflation stemming from the Iran War's effect on oil prices has made a rate hike all but certain today. Something chief economics correspondent Nick Timouros says no one anticipated at the start of the year.

Nick Timouros (3:06)

An interest rate increase would be a big deal here, not just because they haven't raised interest rates in three years, but because Donald Trump put somebody in charge of the Fed earlier this year who he said was going to lower interest rates, and now four months into Fed Chairman Kevin Warsh's term, you could actually see the Fed raising interest rates.

The second thing I'm watching is, does everybody support it? Descents happen, but if the Fed raises interest rates but somebody says, hold on, I don't think we need to do this, that could create an awkwardness for the Fed Chair because President Trump has been suggesting Kevin Warsh didn't want to raise interest rates, and it was a hostile committee dragging him to do it.

The third thing I'm watching this week is, how do they explain their decision, whatever it is they do? If they raise interest rates, what is it that they think they're trying to accomplish here? And what is it that hasn't gone according to plan this year? Because at the beginning of the year, it looked like the Fed thought it was going to be cutting interest rates. If the Fed holds interest rates steady, that's going to invite a lot of questions because markets overwhelmingly have anticipated a rate increase given everything that's happened in the economy and everything Fed officials said in the run up to this meeting.

Luke Vargas (4:27)

For more analysis from Nick, head to wsj.com, where he'll be leading our Fed coverage throughout the day. Of course, a key driver of inflation are prices at the pump. According to Brown University, American consumers have spent an additional $100 billion on fuels since the onset of the Iran War, costing the average US household more than $760 in extra expenses since late February. While gasoline accounts for the majority of that added tab, surging diesel costs, which have climbed over 60%, are posing a broader risk to the economy, driving up transportation and production expenses across agricultural, manufacturing, and retail supply chains.