A battle over the Fed's future is underway as Kevin Warsh faces senators.
It's World Business Express from the BBC World Service.
I'm Leanna Byrne.
Apple will enter a new era with a new CEO and business confidence in Germany takes a turn for the worse.
So Donald Trump's pick to lead the Federal Reserve, the United States' central bank, Kevin Warsh, is being grilled by senators.
He's appearing before the Senate Banking Committee making the case that he's the right man to run the US central bank.
He delivered his opening statement, and here's part of what he said.
As Senator Warren said, I do not believe that independence of monetary policy is threatened when elected officials state their views on rates.
Fed independence is up to the Fed.
That has three implications.
First, Congress is tasked with the mission to ensure price stability.
Inflation is the Fed's choice.
Second, Fed independence is at its peak in the conduct of monetary policy.
And third, as the chairman said, the Fed must stay in its lane.
I'm joined now by our North America business correspondent, Michelle Flurry.
Michelle, the Fed must stay in its lane.
What does he mean by that?
Yeah, so the Federal Reserve does a lot more than just interest rates and monetary policy.
It also oversees a degree of bank regulation.
But in recent years it sort of stepped in things like of how to get involved in environment and where that intersects with money.
And those are the kinds of things that he's referring to.
In some ways many people won't have any argument necessarily with that where the Fed has weighed into social issues.
But The question is, how far will he go with that?
And I think that is something you can expect lawmakers to press him on.
We've also heard from Elizabeth Warren.
She's the co-chair on this.
She's the sort of top ranking Democrat on this panel.
And she has criticised his record saying that he was terrible as a governor at the Federal Reserve during the financial crisis.
So we've already heard some pretty kind of strong, strong words.
And we're only, you know, not that long, not that far into this hearing.
So how can we expect today to play out?
Well, this is his chance to kind of lay out what kind of Fed governor he will be, to stress whether or not he supports the independence of the Fed, which will be key.
He was also asked about some of his money.
He's got about $100 million in investments.
Elizabeth Warren was asking him if any of that was involved with Trump family businesses, with money laundering, with Chinese investments, with investments tied to Jeffrey Epstein.
He wouldn't answer that question but he said he was planning to divest that money.
So these are the kinds of questions we'll get.
In terms of confirmation, obviously, we've got Senator Tillis potentially holding that up.
So we'll have to watch that space.
Michelle, thank you so much.
Now, 15 years after he took over from Steve Jobs, Apple has announced that Tim Cook will be stepping down as CEO.
Cook oversaw the launch of products including AirPods and the Apple Watch.
Here's a look back at his tenure.
Good morning.
This is my first product launch since being named CEO.
I love Apple.
Five four three two, one.
Isn't it great?
We've democratized uh film and so you can make an entire movie on an iphone.
Today we're bringing 5g to iphone.
Apple watch is the most personal device we've ever created.
Good morning, welcome to apple park.
There you go.
He will be replaced by the company's head of hardware engineering, John Ternus, on the 1st of September.
Ken Siegel was Steve Jobs' creative director for more than a decade, including at Apple, in the early years of Tim Cook's time as senior vice president for worldwide operations.
Tim did an amazing job being an operations guy.
He was a really good businessman and managed the giant apple into the monolith it officially has become.
I think when people talk about the difference between Steve and Tim, that was basically it.
Steve, the visionary.
Tim...
The operations guy who took over and he took over because he was Steve's choice.
So you know I have to respect Steve's ability to see who would be the right person to take over Apple.
That was Ken Siegel, Steve Jobs' creative director for more than a decade.
With me now, Fiona Sincotta, Senior Market Analyst at Citi Index.
Wasn't much of an operations guy, but in fairness, Fiona, he made a lot of money for Apple.
Yes, definitely.
So Apple gained around $3.66 trillion in market cap value under Kirk.
Now has a market cap of over 4 trillion, making Apple, meaning that Apple makes up a large chunk of the US stock market.
Profits improved by 699% under Cook's eye.
And he also instilled a base of 2.5 billion active devices.
There's some big numbers there.
Now, what do we know about John Ternus?
Well, he's been working at the company for around 25 years, rising through the ranks from product design team to becoming sort of vice president of hardware engineering, and then on to senior vice president of hardware engineering.
So very much involved in the engineering of best-selling products like the Mac, the iPhone.
But they're saying that Ternus has the mind of an engineer, the soul of an innovator and the heart to lead with integrity and honor.
So we will be watching this space.
Yeah, absolutely.
Really interesting.
And of course, this announcement came out after Wall Street closed yesterday.
So what is Wall Street's opinion on this today?
Yes.
So, I mean, we are seeing that Wall Street is a little bit higher.
Apple itself is just a little bit lower, in fact, on the day.
That's probably more of the initial knee jerk reaction to the Cook departure rather than the Ternus coming in.
Fair enough.
All right.
Fiona Sincotta, Senior Market Analyst at Citi Index.
Always a pleasure.
Thanks for joining us.
OK, let's turn to Europe's largest economy now and a fresh snapshot of business confidence that's taken a sharp turn for the worse.
Germany's closely watched SWEV indicator of economic sentiment has fallen much more sharply than expected this month, dropping deep into negative territory as firms grow increasingly uneasy about the economic fallout from the Iran war.
Earlier, I spoke to Carsten Breski, chief economist for Germany at the bank ING.
I asked him how exposed is Germany to the war?
Germany is extremely exposed to energy prices, exposed to everything going on currently in the Strait of Hormuz.
And it ties into this drop in business sentiment we saw already a month ago with other more prominent leading indicators, as hopes for this recovery that we had at the start of the year are clearly going up in thin air currently.
And what industries are most exposed?
Well, Germany has quite some energy intensive industries.
Think of the chemical industry.
Think of the pharmaceutical industry.
So these are key sectors that are clearly exposed to higher energy prices.
Add to that that German industry in general is clearly also depending on international supply chains.
And if we were to see now, for example, Asian industry being reduced due to the lack of physical oil, this could be another big bummer for German industry.
Some of those industries were struggling already.
I was thinking about the automotive industry.
That's just going to be another nail in the coffin.
Germany seems to have also really bad luck, because there were clear signs of a rebound in the making on the back of more fiscal spending.
And even the automotive industry seemed to be going through this, bottoming out with a bit of hope for some kind of recovery in 2026.
And with this energy price shock, the risk is high that this recovery will simply not come this year.
On a more positive note, the fiscal spending is still coming.
And we're really talking about more than 200 billion euro that the German government intends to put into the defense and infrastructure sector this year.
So this is enormous.
I'm still mildly optimistic that we will see a bit of growth coming in Germany.
That was a mildly optimistic Karsten Breski, Chief Economist for Germany at the Bank ING.
And that is it from World Business Express from the BBC World Service.
I'm Leanna Byrne.
Have a great day and thanks so much for listening.
