Hassett Says Fed Should Cut Rates, Predicts 25 Basis Points

Economic

Summary:

National Economic Council Director Kevin Hassett said the Federal Reserve should cut interest rates at its meeting next week and predicted a reduction of 25 basis points as speculation grows that President Donald Trump is readying his nomination to lead the central bank.

Hassett, speaking in an interview on Fox News, was asked if he believed the Federal Open Market Committee would cut rates.

"I think we should, and I think that we are likely to," Hassett said, pointing to recent communications from Fed governors and regional presidents. "They now seem much more like they're leaning in the direction of a rate cut."

Hassett said he wanted to "get to a much lower rate" over the long run.

"If there's consensus around 25 basis points, which it looks like there is, then I'll take it," he continued.

The presidential economic adviser demurred when asked how many additional cuts he might pursue if nominated and confirmed to lead the Fed, saying the chair's job was to be "very data responsive" and consider what adjusting the rates would do to inflation and employment.

Trumponomics: What If Kevin Hassett Becomes Fed Chair?

"The president has a number of candidates that he's been thinking about," Hassett said. "I'm honored to be on a list with some great people. And we'll see how it goes."

Trump said earlier this week he plans to announce his selection to lead the Federal Reserve in early 2026 and had settled on a finalist. He has repeatedly praised Hassett in recent days and teased his possible nomination.

"I guess a potential Fed chair is here too," Trump said during an event Tuesday at the White House. "I don't know who is allowed to say that — potential. He's a respected person that I can tell you. Thank you, Kevin."

Trump allies have been discussing the possibility of giving Hassett's current role leading the National Economic Council to Scott Bessent — in addition to his job as Treasury secretary — should the nomination move forward.

Source: Bloomberg

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