First Thing: US government borrowing costs hit new high as US strikes resume on Iran

Federal Reserve votes to hold its key interest rate steady, sending stocks tumbling. Plus: the origins of Coca-Cola may have been found

Good morning. US government borrowing costs have hit their highest level since 2007 after the Federal Reserve voted to hold its key interest rate steady, feeding fears it may not move fast enough to tame a rise in inflation. Kevin Warsh, the central bank’s chair, said the Fed would “not waver” in its commitment to tackling rising prices.

The decision to leave rates on hold has spooked investors, who are worried about the US economy’s ability to absorb a rise inflation, caused by Donald Trump’s war in Iran. US inflation cooled to an annual rate of 3.5% in June after Washington and Tehran agreed a brief ceasefire – but this has since ended. US stocks fell sharply on Wednesday, with the blue chip S&P 500 index closing down 1.5%. The Dow Jones industrial average fell 2.2% and the tech-heavy Nasdaq was down 1.7%.

US launches fresh strikes on Iran after days-long pause, amid fears war is widening

The US military has launched strikes on Iranian targets in response to Tehran’s attack on American forces in Jordan on Wednesday, risking a return to all-out-war in the region. The latest round of strikes were launched hours after President Donald Trump vowed to hit Iran “very hard” after it targeted a base in Jordan that hosts US troops, and comes after a days-long pause in violence between the two sides.

US central command said in a social media post that over the span of two hours they had struck “dozens” of targets belonging to Iran’s Revolutionary Guards Corp. The barrage came after the US partnered with Saudi Arabia to strike Iran-backed militias in neighboring Iraq on Wednesday, killing at least 20 fighters and six Iranian advisers. The renewed hostilities sent oil prices soaring. Brent crude, the international standard, jumped 7.3% to more than $88 a barrel.

Fauci invokes fifth amendment and declines to testify in Senate Covid hearing

Dr Anthony Fauci refused to answer questions at a high-profile Senate committee hearing on the origins of Covid-19 and accused the Republican senator leading questioning of having an “unhinged obsession” with him. The hearing was called by the Kentucky senator, Rand Paul, who has investigated Fauci for years. Fauci said Paul’s goal was “embarrassing and intimidating me”, and ultimately landing him “behind bars”.

Gary Peters, the Democratic senator of Michigan, described the hearing as damaging to science and ignoring continuing public health threats, such as the outbreak of the food-borne parasite cyclospora and measles, both at record highs. “It’s attempting to turn one person into a scapegoat for a crisis that hundreds of officials across the Biden and Trump administrations were responsible for handling,” said Peters. “This is only going to deter other scientific experts from public service.”

What did we learn from the hearing? Jessica Glenza has analysed the hearing , and reports that six years on from the Covid crisis, Republicans are still politicizing science – and Dr Fauci remains a political punching bag. Wednesday’s hearing, she says, was another example of how criticizing scientists has become an important outlet for the party – and where re-litigating the Covid crisis justifies skepticism of a broad range of science.

UK government reviews why police ceding criminal cases to US military

The UK government and police chiefs are reviewing the process through which US military personnel accused of committing serious crimes on UK soil are avoiding the British justice system.

The effort, involving multiple government departments, is examining why UK police forces, which have primary responsibility for investigating such cases, have been ceding jurisdiction to US military investigators. Survivors of sexual attacks by US military personnel that would meet a common definition of rape in the UK are finding that perpetrators are instead being prosecuted for lesser offences.

In other news …

The death toll from the powerful earthquake that hit Japan on Tuesday has risen to 30 , as the search for survivors trapped in a badly damaged shopping mall, paper mill and collapsed homes across the south-west of the country continues.

The US Senate judiciary committee postponed a vote scheduled for Thursday on whether to advance Trump’s pick for US attorney general, Todd Blanche , after the Department of Justice did not provide written assurances to a Republican senator that a $1.8bn slush fund was dead.

Russian air strikes killed at least 13 people in Ukraine on Thursday , as attacks that extended as far ⁠as the western city of Lviv caused neighboring Poland to scramble ​fighter jets to secure its airspace, and a missile landed in a field in Poland.

Elon Musk’s company xAI has sued Minnesota over the state’s first-in-the-nation law banning “ nudification ” technology on websites and apps.

European football authorities have called an emergency meeting over Fifa’s plan to sell a stake in future men’s soccer World Cups to private investors.

Stat of the day: Hollywood producer charged with seven counts of wire fraud in $100m scheme

A federal grand jury in Chicago has charged the Hollywood producer Jason Cloth with seven counts of wire fraud for allegedly defrauding investors of $100m, according to federal authorities.

The Filter Recommends: Can’t hear what’s playing on TV? These affordable soundbars can help

Ryan Waniata offers his advice on what to buy so you can get rid of the subtitles to hear what movies and TV shows are supposed to sound like – for as little as $130.

The Broken King, the new memoir by Michael Thomas, is “an extraordinary read” according to Steve Rose in this interview . Deeply personal and intimate, it covers what Thomas describes as the “perfect storm of conditions” – poverty, parental abandonment, racism, alcoholism, sexual violence, self-sabotage and mental illness – that has led to its release being two decades after his breakthrough debut novel, Man Gone Down.

Climate check: Three firefighters killed in Greece as Europe battles wildfires

Wildfires fueled by the climate crisis continue to burn across Europe, forming an arc from the Atlantic coast to the eastern Mediterranean and from the Highlands of Scotland to southern Spain. Three firefighters have died after tackling wildfires on the Greek island of Crete. Meanwhile, temperatures climbed to 100F in Bordeaux on Wednesday, where French firefighters stopped a huge blaze in nearby pine forests from reaching the suburbs.

Last Thing: Was Florentine friars’ fatigue-fighting elixir a precursor to Coca-Cola?

An Italian friar has unearthed a document from the pharmacy archives of an ancient convent in Florence describing a medicinal potion made from Bolivian coca leaves and kola nuts, prompting suggestions it could have been a precursor to the famous US soft drink, Coca-Cola.

Sign up

First Thing is delivered to thousands of inboxes every weekday. If you’re not already signed up, subscribe now .

Get in touch

If you have any questions or comments about any of our newsletters please email newsletters@theguardian.com