Treasury Secretary Scott Bessent has suggested that the Federal Reserve should consider a larger fee rate cut at its September meeting.
Bessent Links Soft Inflation Data to Bigger Fee Rate Cut in September
According to a Bloomberg report, Bessent said the central bank ought to be open to a 50 basis-point fee rate cut after skipping a move at its last policy meeting. He made the remarks shortly after the release of July inflation data, which he described as “incredible.”
The latest consumer price index showed a 0.2% increase from the previous month. Core inflation, which excludes food and energy, rose 0.3%, in line with economist expectations.
While services costs increased, goods prices were more restrained despite President Donald Trump’s recent tariff hikes. Bessent pointed to these numbers as evidence that the Fed has room to act more decisively on monetary policy. This could include a fee rate cut.
He also expressed optimism that Stephen Miran, Trump’s nominee for the open Fed board seat, would be confirmed before the September 16–17 policy meeting. Miran currently serves as head of the White House Council of Economic Advisers.
If approved, he would fill a term running until January, Bessent noted that Miran could potentially remain longer. Beyond a discussion about a fee rate cut, the Treasury Secretary also addressed the search for a new Federal Reserve chair, with Jerome Powell’s term ending in May.
He said Trump is considering a wide range of candidates and emphasized three main qualities for the role. These are strong views on monetary policy, a clear approach to regulatory policy, and the capability to manage and reform the Fed as an organization. He argued that the central bank has become “bloated” over time, putting its independence at risk.
Bessent’s Cut Push Sets Stage for September Fed Meeting
Trump has repeatedly criticized Powell for failing to perform any fee rate cut this year. In addition, Fed officials have called for more evidence on the inflationary impact of tariff increases.
Bessent’s comments suggest that the administration would favor a quicker and more substantial fee rate cut to support economic growth. The push for a half-point cut comes as economic policymakers weigh how to balance inflation control with maintaining momentum in the economy.
The upcoming September meeting is likely to be closely watched for signs of whether the Fed will follow Bessent’s recommendation of a fee rate cut.
Paul
Paul Adedoyin is a crypto journalist with 4+ years experience who provides timely news, in-depth research, and insightful content to inform and empower his audience. His works have been featured on sites such as CryptoMode, CryptoNewsFlash among others.
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