Treasury Secretary Bessent: No Reason for Powell to Resign, Trade Deals on the Horizon
U.S. Treasury Secretary Scott Bessent said Tuesday he sees no justification for Federal Reserve Chair Jerome Powell to step down, even as the administration moves aggressively on trade and economic policy.
Speaking with Fox Business, Bessent defended the administration’s tariff strategy, stating that the measures are actively encouraging domestic manufacturing. He highlighted that President Trump has directed that permits for new U.S. factories be processed within one month, speeding up industrial development.
Tariff Deadlines and Trade Talks Intensify
Bessent reaffirmed that August 1 remains a “hard deadline” for key trade negotiations. However, he clarified that talks could continue even after new tariffs take effect. He added that the current trade deal with China expires August 12, and announced he will meet with Chinese officials in Stockholm next Monday and Tuesday.
“We’ve entered a new phase in the China negotiations,” Bessent said. He added that these talks could expand to include issues like Russia and Iranian oil.
Bessent also flagged India’s purchases of Russian oil as a concern, and said the G7 will engage in difficult conversations on their stance toward Russia.
Despite the geopolitical complexities, Bessent emphasized that trade negotiations and efforts to resolve the Russia–Ukraine conflict should remain separate.
Tariff Revenue, Growth Forecasts, and Fiscal Discipline
Bessent projected that tariff revenues could reach $300 billion annually, describing it as a “big number” potentially worth 1% of GDP. Over the next decade, he estimated total tariff collections could reach $2.8 trillion.
He credited spending cuts for contributing to the June budget surplus, reflecting improved fiscal discipline.
Looking forward, the Treasury Secretary forecast U.S. GDP growth to hit 3% or more by Q1 of 2026, signaling confidence in the country’s economic trajectory.
Trade Talks Progressing With Key Partners
In terms of ongoing negotiations:
- Talks with Indonesia have reached a fifth draft of a trade agreement.
- Discussions with Japan are said to be progressing smoothly, Bessent noted.
These developments suggest the administration is moving quickly to finalize several trade deals in the coming days, reinforcing its broader economic and geopolitical strategy.
