Treasury Secretary Bessent: Focus on 10-Year Treasury Yields, Not Short-Term Rates
Washington, D.C. - Treasury Secretary Scott Bessent clarified the Trump administration's stance on interest rates, emphasizing their focus on lowering long-term borrowing costs through 10-year Treasury yields.
"He and I are focused on the 10-year Treasury," Bessent stated during an interview with Fox Business's Larry Kudlow.
While the Federal Reserve sets short-term rates, Bessent stressed that Trump is "not calling for the Fed to lower rates." Instead, the administration seeks to influence longer-term rates through fiscal policies.
Bessent's comments marked the second time in a week that the White House has eased pressure on the Fed, following President Trump's approval of the central bank's decision to pause rate changes.
Despite previous statements suggesting he would demand lower rates, Trump has since acknowledged the Fed's decision as appropriate. Bessent declined to speculate on future Fed actions, highlighting the impact of economic growth, inflation, and Treasury supply on 10-year yields.
Bessent emphasized the administration's belief that tariffs are a temporary measure to repatriate manufacturing and reduce trade deficits, ultimately reducing the need for high rates. He also reiterated the "3-3-3" economic plan, aiming for 3% deficit, 3% growth, and increased oil production.
Regarding concerns about cryptocurrency, Bessent reassured the public that the payment system remains secure and that a study is underway to enhance accountability and traceability.