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11 Million Under Flood Watches as Storm Shifts to New England; Federal Reserve Keeps Interest Rates Unchanged; Trump's Approval Rating Falls to 34 Percent Per a CNN Poll; Fauci Invokes the Fifth More Than a Hundred Times at GOP-Led COVID Hearing. Aired 2-2:30p ET

Aired July 29, 2026 - 14:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

[14:00:00]

ALLISON CHINCHAR, CNN METEOROLOGIST: -- highest risk of that potential flooding. But any area you see in the green or yellow also has that potential too. So you're talking Boston, Hartford, Providence, any of these areas still looking at that potential to have some flooding as we go through the rest of the day because all of that ample moisture is still surging into areas of the Northeast, fueling that system with all of the rain that it needs.

So again, more of these areas we're going to continue to see a lot of those showers and thunderstorms even as we go through the rest of the evening tonight.

BORIS SANCHEZ, CNN CO-ANCHOR OF "CNN NEWS CENTRAL": Got to be on the watch for those flood concerns. Allison Chinchar, thank you so much for bringing us that forecast.

A new hour of "CNN News Central" starts right now.

BRIANNA KEILAR, CNN CO-ANCHOR OF "CNN NEWS CENTRAL": The Federal Reserve is about to announce a pivotal decision on interest rates and it comes as persistent inflation, conflicting labor market signals and the war with Iran cloud the country's economic outlook.

Plus, Senator Rand Paul threatening to hold Dr. Anthony Fauci in contempt of Congress after Fauci invoked the Fifth Amendment and refused to answer a single question at a Senate hearing on the COVID pandemic. He did it over a hundred times.

And later, new record-low approval numbers for President Trump. In a new CNN poll, a majority of Americans say the president is focused on the wrong priorities.

We're following these major developing stories and many more, all coming in right here to "CNN News Central."

Breaking News just into the newsroom. The Fed just made its decision on interest rates in the face of increasing inflation pressures. We have CNN's Matt Egan, who is there at the Fed's main office in Washington. What's the decision, Matt?

MATT EGAN, CNN SENIOR REPORTER: No change in interest rates. The Federal Reserve voting today to keep interest rates on hold for the fifth meeting in a row. And this does signal the fact that most Fed officials, they're willing to wait and see whether or not inflation cools off on its own without the Fed having to take action, like interest rate hikes, that could end up damaging the economy.

However, what's important to note is that this decision, unlike the last one, was not unanimous. In this decision, not one, not two, but three Fed officials dissented, favoring an interest rate hike. Those officials were Cleveland Fed President Beth Hammack, Dallas Fed President Lorie Logan, and Minneapolis Fed President Neel Kashkari.

Now, this is an unusual amount of dissent. It's the first time since September of 2016 that three officials dissented in the same direction. In this case, they all wanted more action here to address inflation.

Now, new Fed Chairman, Kevin Warsh, he has signaled that he welcomes debate. He's called it a good family fight and clearly, he won that fight today. However, this 9-3 vote, it does signal growing desire from officials inside this building to take action, and it signals that some of them are losing patience when it comes to trying to get inflation back down.

Now, turning to the Fed statement, it was almost exactly the same as the last meeting. It was basically a carbon copy. The only things that changed were the vote count and the date. The Fed reiterated in their statement that economic activity is expanding at a solid pace, despite elevated uncertainty that owes in part to the conflict in the Middle East.

And the Fed also reiterated that inflation remains elevated relative to the Fed's two percent goal, in part reflecting supply shocks driven by increases in prices in some sectors, including energy. And the Fed reiterated that the committee will deliver price stability.

So look, the bottom line here is no action from the Fed today on interest rates. However, the fact that the Fed is increasingly divided, it does suggest that there is going to be more and more pressure on Warsh to take action soon if inflation does not come down. Back to you.

KEILAR: Yeah, we'll be watching for that. Matt, thank you so much for us. Boris?

SANCHEZ: Let's talk more about what this decision from the Fed means. Joining us now is the Business Columnist and Founder of Pinpoint Press, Rick Newman.

Rick, always great to see you. What do you see is the impact of this decision to hold rates where they are?

RICK NEWMAN, BUSINESS COLUMNIST, FOUNDER, THE PINPOINT PRESS: This is what markets expected. The investors did not think the Fed was going to raise rates at this meeting. So no surprise here, and that's a good thing. But I think people need to keep a couple of things in mind. First of all, the Fed only sets one type of interest rate, and it's the type of interest rate that mostly affects banks.

What we have seen happening during the last five months, which is the period of time the Iran War has been underway, is longer term interest rates, which affect mortgages, car loans, business loans. I mean, the loans that businesses and consumers actually take out, those rates have been going up, and that is happening in the market. The market sets those rates. That is not the Federal Reserve.

[14:05:00]

So if you're in the market for a home and you're looking for a mortgage, the mortgage rate has gone up from six percent before the war started, and now it's around 6.7 percent. So those interest rates are up, which means those borrowing costs are up. So that is something that consumers and businesses have to face. But what the Fed is saying today is, we're not sure about the future path of inflation, just like all the rest of us, to be honest.

SANCHEZ: Yeah, that's right. To that point, Fed officials largely agree that the Central Bank shouldn't respond to higher energy prices with interest rate hikes. But does the decision potentially risk inflation broadening out beyond the energy market?

NEWMAN: I mean, nobody knows, and it all depends on what happens in the Strait of Hormuz. I mean, the Federal Reserve, filled with economists, but they're asking the same basic question all the rest of us are asking, which is how long is this Iran War going to go on? Are oil prices and gasoline prices going to start coming down in the fall because somehow this gets resolved? Or is this going to go on through the midterm elections into 2027?

And I think nobody knows that. I mean, I don't even think the Iranian government knows that. They seem to be doing it on a day-to-day basis. President Trump obviously can't get this thing over with. So this is the biggest thing everybody's grappling with. And the Fed basically said, we're just going to kick the can down the road. The next meeting is in September. So we'll be having all these discussions again in a couple of months.

SANCHEZ: Yeah, the vote was 9-3 with three dissenters voting to raise rates. I wonder what you're looking to hear from those that dissented and also from Kevin Warsh himself because, as he set to speak in a matter of moments, he's declined to offer clear guidance about where he sees interest rates going.

NEWMAN: So he thinks the Fed talks too much and offers too much guidance to markets. I'm not sure he's really going to do anything all that different. I mean, I think he wants to come in and say there's a new man and there's a new sheriff in charge and establish credibility on his own terms. But if the Fed just keeps everybody guessing, that's not really going to be a great thing either.

So we're going to just -- I think he's going to come out and he's going to say what we're saying right here. We just don't know what's going to happen with energy costs in particular. And maybe in two months, we'll just have a clearer idea. Then we can start focusing. Is there underlying inflation aside from energy? But it's a very muddy picture right now.

SANCHEZ: The job market has also been a bit of a question mark, even though it's remained stable. A.I. has kind of left things, the future, a bit nebulous. What do you think the Fed is going to be watching very closely when it comes to the A.I. market?

NEWMAN: So, I mean, the Fed does watch the job market and part of its job is to make sure employment is stable. And it is pretty stable right now. What's happening with -- there are a lot of things happening with A.I. We're not seeing a job apocalypse yet. Some people think that will happen, but other people say, well, look what happened with the internet. Some jobs went away, but we got all these other new jobs that never existed before.

But beneath oil and energy inflation, some of these components that go into data centers have gotten very expensive because there's basically shortages. So that is another source of inflation. And I think the Fed would love to get the Iran War resolved, so they could look at these other things that might be causing inflation and figure out is that a problem they have to deal with or will the market take care of it? Will we get more supply of these chips that are in short supply right now? But it's all oil and Iran right now.

SANCHEZ: Yeah. And you mentioned mortgage rates a moment ago. They're hovering just above six percent right now, in that six to seven percent range. Where do you see them heading?

NEWMAN: This depends also on the Iran War. I keep going back to this.

(LAUGH)

NEWMAN: I'm sorry to sound like a broken record, but tell me what the price of oil is going to be.

SANCHEZ: Right.

NEWMAN: If we can get the Iran War resolved and oil prices come back to, let's say, $80 per barrel or even to $70, which is around where they were before the war, then investors are going to worry less about future inflation and long-term interest rates, not the ones set by the Fed, but the ones set in the market. They will come down.

But we have had a hard time getting back to the status quo before the war, which was mortgage rates at six percent, not 6.7, and oil at $68 a barrel, not $95 a barrel. So it's just extremely uncertain.

SANCHEZ: Rick Newman, appreciate the expertise. Thanks for joining us.

NEWMAN: Thanks, Boris.

SANCHEZ: Of course. As you just heard from Rick, everybody wants to know where things are headed with the war in Iran. And oil prices have jumped with President Trump threatening to hit Iran hard. We're tracking the latest developments out of the Middle East after the U.S. intercepts Iranian missiles targeting U.S. forces. [14:10:00]

Also, new CNN polling on an issue that most Americans agree on, how old is too old to serve in Congress? We'll break down those new numbers, straight ahead.

And a new State Department report accusing the Cuban regime of infiltrating the U.S. for decades. We'll speak to a spokesperson from the State Department when we come back.

(COMMERCIAL BREAK)

SANCHEZ: Some brand new CNN polling shows that President Trump's numbers are plummeting. He's underwater on almost everything -- Iran, gas prices, inflation, immigration, and the list goes beyond that.

73 percent of Americans say the president has not paid enough attention to the country's most important problems, a number that is a record high.

[14:15:00]

KEILAR: The president's overall approval rating now stands at just 34 percent and that matches his career low following the January 6th insurrection. CNN Washington Bureau Chief and Political Director, David Chalian, is here to break down all these numbers for us.

David, I mean, first off, what are Americans most worried about here?

DAVID CHALIAN, CNN POLITICAL DIRECTOR & WASHINGTON BUREAU CHIEF: Yeah, I mean, I think the issues that are driving this unpopularity are the Iran War and the fact that costs are still high. I mean if you look at the issue set that we tested, President Trump does not crack 30 percent approval. Look at the bottom three -- on Iran, inflation, and gas prices. He doesn't even get to 30 percent approval on those issues.

Those are the major issues of the day and that is what is driving a lot of the unpopularity. You noted some records that you mentioned that the president had there. I mean the handling of Iran at only 28 percent approval, look at how that has changed over time. In March, that was 33 percent approval. He's gone down in the wrong direction on the handling of this war.

And on inflation, just look at the disparity. You guys cover all this stuff every day. We live in such polarized, like divided times. How often do we see three-quarters of Americans on one side of a question here and only a quarter on the other? He has three out of four Americans disapproving of his handling of inflation, the issue that I think you could argue returned him to the Oval Office and this promise to bring prices down.

SANCHEZ: Digging into your point about polarization, how is his standing among Republicans in his own party?

CHALIAN: Another record in our poll and not the kind that Donald Trump is going to tout. It is a numeric low among Republicans. 78 percent approve of the job that Donald Trump is doing. Now, obviously, 78 percent is a high number but Donald Trump, as you know, the command and control he has over the Republican Party, his number has never been as low as 78 percent among his fellow partisans.

I'm not suggesting the party is all of a sudden going to flee him, but I am suggesting we are seeing erosion among his very party faithful inside the GOP.

KEILAR: A lot of focus on the age of the president, this president being the oldest ever elected and following a president who was also up in years, right? But I wonder, because it used to be we talked about members of Congress who were up in years and that's still very much the case. There are several members of Congress who are older than him. We've seen certain issues when it comes to health. How are Americans feeling about this issue?

CHALIAN: Not so good. I mean, Americans, a clear majority of Americans do not believe that having so many people over the age of 70 is a great thing for democracy, but if you look at it broken by party, it seems to be more of a concern among Democrats and Independents than it is of Republicans if you think politicians over the age of 70 is a problem.

But again, add all that together, the overall number is a majority Americans think that is a problem to have politicians over the age of 70. And you mentioned some recent stories about like Mitch McConnell and whether or not -- people want transparency. I mean they -- the public wants elected officials to release medical information publicly by two to one. Two-thirds say yes, they should. 35 percent say they shouldn't. So they're not so happy with the age of their politicians and they're not so happy with the lack of transparency.

KEILAR: it's not just because they're curious, I think we should say. They want to know that these are elected officials who can do the work that they've been elected to do.

CHALIAN: They're their representatives --

KEILAR: Yeah.

CHALIAN: -- in government, yeah.

KEILAR: Yeah. David, thank you so much for all of that.

Still to come, a tense hearing on Capitol Hill. Dr. Anthony Fauci taking the Fifth more than a hundred times, refusing to testify on the COVID-19 pandemic, as Republican Senator Rand Paul threatens to hold him in contempt of Congress.

Plus, it's a condition that affects one in every 1,000 women who give birth. We'll talk to a doctor about postpartum psychosis, next.

(COMMERCIAL BREAK)

[14:23:26] KEILAR: Earlier today, Dr. Anthony Fauci faced more than a hundred questions on Capitol Hill and more than 100 times, he refused to answer.

(BEGIN VIDEO CLIP)

ANTHONY FAUCI, FORMER CHIEF MEDICAL ADVISOR TO THE PRESIDENT OF UNITED STATES: I respectfully decline to answer based upon my rights under the Fifth Amendment of the Constitution.

I respectfully decline. I respectfully decline. I respectfully decline. I respectfully decline to answer based upon my rights under the Fifth Amendment to the Constitution.

(END VIDEO CLIP)

KEILAR: Fauci led the U.S. government's response during the COVID pandemic. He repeatedly invoked his Fifth Amendment right after he accused Republican Senator Rand Paul of holding the hearing to intimidate him. Senator Paul and critics argue that recently released diary entries from Dr. Fauci prove unfounded claims about COVID-19's origin or certainly, that Fauci was saying one thing privately versus what he was saying publicly.

We're joined now by former CDC Chief Medical Officer, Dr. Deb Houry. She resigned from the CDC over concerns about Health and Human Services Secretary Robert F. Kennedy Jr. She is now a Senior Fellow at the Yale School of Public Health. And I just wonder, as you have been watching what happened today, what did you think about it?

DR. DEB HOURY, FORMER CDC CHIEF MEDICAL OFFICER: Well, I think it's a shame we're focusing on this, when right now we're in the middle of a big measles outbreak, food-borne outbreak, ebola. You would think Congress would want to focus on the state of public health in our country versus re-litigating something from years ago when they obviously don't want to find a solution to that.

[14:25:00]

KEILAR: I think this speaks to -- and you're saying they don't want to find a solution to this. There's obviously been a big politicization of this question.

(CROSSTALK)

HOURY: (Inaudible) Yeah.

KEILAR: There's been a big politicization about COVID, how it started, who's to blame, lockdowns, all those kinds of things. We saw that playing out, certainly in the question side of things.

But we do need to know what happened, right? So that it doesn't happen again. What does a hearing like this do to that? You have Fauci taking the Fifth, even as he's been pardoned, saying that he's afraid Senator Paul wants to make good on threats to see him behind bars. Senator Paul opens his questions reminding Fauci of the jail time that one can serve for lying to Congress. How do we actually get answers that help us in the future and that help restore some faith in public health?

HOURY: 100 percent agree. And I think that's the issue is, you know, Dr. Fauci had mentioned he had done many hearings to testify about this before. And I think the issue is science evolves, you know, and then you communicate that to the public. But the issue is when career scientists are being, you know, really persecuted versus being listened to, that's the issue.

I think to get to the bottom of it, you know, certainly you can talk to many career scientists, look at people outside the field. But it really needs to be done with that lens of accountability and how you improve things. At CDC, when I was there, we had a CDC moving forward effort because there were so many lessons learned and we looked at how we could improve communication, the lab errors, readiness.

But it has to be done with that lens of how can we learn from this versus who do we prosecute? And that when you come out from that lens, you're not going to have a productive conversation.

KEILAR: So let's talk about that then, because initially, mainstream scientists and public health officials were -- they were very much leading us to believe the lab leak theory was conspiracy theory stuff. And it was, right?

But we've also learned that if you're really looking for what happened, you cannot rule it out as definitively as scientists were sort of broadly, right, ss what we were hearing as this sort of prevailing stance. Why were they ruling it out so definitively, in your opinion? And what is there to be learned going forward about that?

HOURY: Yeah, I can't speak to why they ruled it out so early. You know, I'm not a virologist that understands a lot of these mutations.

But, you know, to me, certainly you want to consider all the possibilities. But as a public health practitioner, what I really cared about was what was the focus on the American public in the world? We had this novel virus and we needed to respond to it and to protect people and develop vaccines and therapeutics. And that's where I think the focus really needed to be on.

How do we protect people? How do we respond to it? How do we ensure people were tough?

KEILAR: So during COVID, you had a lot of people, especially on the right, who were very distrustful of public health officials. You now have a public health approach in the Trump administration that many people on the left are distrustful of. How do you see what is happening?

Obviously, we know your history, having served in the administration and leaving. But how are you seeing how that is contributing to trust in public health?

HOURY: I think it's concerning, you know, even Dr. Fauci's successor, she raised concerns about political interference and her job was terminated. Right now, we're seeing that the acting CDC director, who's political, is not following CDC scientists, neither is the secretary. They

overruled the Hantavirus guidance from CDC scientists, who said it was OK for individuals to quarantine at home with close supervision. Instead, they kept the people in Nebraska. So this is where it's difficult to know who to trust. And states don't know where to turn because the guidance is politicized. And that's not how this should be.

It should be about taking care of people and populations and following the data and science.

KEILAR: And I'm sure you have opinions for scientists who are kind of doing science with an eye to politics and politicians who are wading into science with an eye to politics. But what do you say to consumers, right, the people whose health may be determined by all of these people who are making these decisions and are making these political points, what do you say to them about how to approach this?

HOURY: I'd say, unfortunately, right now, the CDC and other federal agencies, it's difficult to know when and what to trust. So go to your local health department, your state health department, medical organizations like the American Academy of Pediatricians. They've been putting out really good evidence-based guidance.

I really wish that we would get away from ideology and focus on data and science, realizing people are human, that things can change and --