Trump Pushes Fed as Bessent Calls for Rate Cuts
The Trump administration is once again pressuring the Federal Reserve, as newly appointed Treasury Secretary Scott Bessent calls for immediate interest rate cuts.
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Treasury Secretary Scott Bessent |
His appeal comes amid signs of economic uncertainty and inverted bond yields, often seen as a precursor to recession.
The Trump administration is once again pressuring the Federal Reserve, as newly appointed Treasury Secretary Scott Bessent calls for immediate interest rate cuts.
His appeal comes amid signs of economic uncertainty and inverted bond yields, which are often seen as a precursor to recession.
“The bond market is clearly flashing caution,” Bessent said at a policy forum. “It's time for the Fed to respond accordingly.”
The administration believes that easing rates now would support consumer spending and business investment, especially with inflation easing.
This stance aligns with President Trump’s pro-growth agenda, especially ahead of the 2026 midterm elections.
The administration insists that the Federal Reserve has room to lower rates without threatening price stability.
Federal Reserve Chair Jerome Powell remains cautious. While acknowledging market movements, Powell emphasizes data-driven decisions and warns against premature action.
“We must ensure inflation expectations are firmly anchored before adjusting policy,” he said recently.
This isn’t the first Fed clash under Trump. Powell has previously resisted political pressure to lower rates, defending the central bank’s independence throughout Trump’s earlier term.
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