Kevin Hassett, a leading candidate for Federal Reserve (Fed) chairman, said the central bank would remain independent even as it faces pressure from the White House. His remarks come as financial and crypto markets are closely watching signals on interest rates and the future trajectory of US monetary policy.
In brief
- Kevin Hassett said the Fed's policy decisions would remain in the hands of the FOMC, emphasizing that interest rates would be set by data rather than presidential intervention.
- Daily discussions with President Trump would continue if Hassett becomes Fed chairman, although he clarified that these exchanges would not carry formal policy weight.
- Hassett spoke of easing prices in some areas, citing slowing inflation, stronger income growth and signs of improving consumer purchasing power.
- Jobs data remains mixed, with Hassett favoring household surveys while November employment figures are crucial for assessing growth momentum.
Hassett says he would listen to Trump, but not follow rate instructions
Decisions on interest rates, Hassett explained, would continue to be made by the Federal Open Market Committee rather than the president. As the debate over Fed independence resurfaces, he said committee members rely on economic data to vote on policy.
President Donald Trump recently said he “should have a role” in discussions with the central bank. In response to those comments, Hassett said he would listen to the president's views but would not treat them as directives.
Trump has “very strong, well-founded opinions,” he said, but those opinions would not trump formal votes on the federal funds rate.
As head of the National Economic Council, Hassett already speaks with Trump daily. These discussions often cover economic conditions, including monetary policy. That communication would continue if he became Fed chair, he said, but without decision-making authority on the committee.
Only arguments supported by economic data would be taken into account in political discussions. Even then, Trump's opinion would not be “weighty” compared to that of the voting members. Hassett said this standard applies to all external voices.
Mixed macroeconomic signals as inflation persists and growth accelerates
CBS moderator Margaret Brennan cited official data showing consumer price index inflation at 3% year-on-year and personal consumption expenditure inflation at 2.8%. Hassett responded by pointing to charts of prices per item that Trump mentioned during a recent speech.
Prescription drug prices increased 9% during Joe Biden's term and have decreased 0.6% so far this year, Hassett said. Broader price relief, he added, often takes time to reach consumers, particularly after periods of political disruption such as government shutdowns.
Regarding consumer strength, Hassett said the U.S. economy is growing at a rate of 4 percent. Revenue growth increased by about $1,200 this year, contributing to what it described as the strongest Black Friday on record. In contrast, real purchasing power had declined by about $3,000 under the previous administration.
Hassett signals easing in food, energy prices as Fed assesses growth outlook
Food and energy prices are also in focus as they remain closely watched by voters and investors. Grocery costs increased from about $400 to $525 per month under Biden, according to Hassett. Although prices have started to fall this year, he said further improvement is still needed.
Hassett cited several policy measures related to trade and energy :
- Removal of tariffs on certain imported food products.
- Lifting taxes on goods not produced locally.
- Oil price low enough to allow supply-side actions.
- Strict strengthening of control over Venezuelan oil flows.
- Reduced black market shipments.
Lower oil prices give the administration flexibility to limit sanctioned crude exports without driving up global prices, Hassett said. He added that exporting countries are already under economic pressure, limiting the wider impact on the market.
Hassett also addressed the Fed's view that job growth has slowed and surveys indicate lower hiring expectations for 2026. He said surveys can be unreliable and instead highlighted household employment data as a clearer indicator.
Data from the October household survey remains unavailable, making the November report important for assessing the strength of the labor market. Fed officials, Hassett said, continue to expect firmer growth once more complete data is obtained.
Trump has publicly named Hassett and former Fed Governor Kevin Warsh as finalists for the Fed presidency. Hassett said his daily conversations with Trump would continue regardless of the choice, adding that Warsh would likely do the same. He noted that Fed chairs speak regularly with policymakers and market participants, but that outside opinions do not override the committee's decisions.
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