National Economic Council director Kevin Hassett has stated he informed President Donald Trump that he would accept the nomination to replace Jerome Powell as Federal Reserve chairman if offered the position. Hassett also indicated his preference for a more substantial interest-rate cut when policymakers convene in December. Trump has identified Hassett as one of the finalists for the role.
Hassett suggested that, based on his assessment, he anticipates the Fed to reduce its key interest rate by 25 basis points. He expressed surprise that Powell had not been compelled to implement a more aggressive cut, considering the extended government shutdown and inflation figures that surpassed expectations.
Speaking at an Economic Club of Washington event, Hassett noted that President Trump believes rates could be significantly lower, a view he shares. He suggested that a 50 basis point cut would be justified. Hassett estimated that each week of the government shutdown reduced US gross domestic product by approximately $US15 billion ($23 billion), and pointed out that September’s inflation data was below projected levels.
Despite these apparent disagreements on monetary policy, Hassett affirmed that he holds “high regard” for Powell, in contrast to Trump’s frequent public criticism of the current Fed chairman.
