White House economic adviser Kevin Hassett said on Tuesday that there is still “plenty of room” for additional interest rate cuts. However, he also cautioned that rising inflation could change that view.
Speaking at the WSJ CEO Council, Hassett—widely regarded as a leading candidate to become the next Federal Reserve chair—compared the current economic backdrop to the 1990s. He described the moment as a “potentially extremely transformative time” for the U.S. economy.
Hassett was also asked how he would respond if President Donald Trump pushed for rate cuts he personally disagreed with. He pointed to a situation where cuts would not be appropriate. If inflation increased from 2.5% to 4%, he said, rate reductions “can’t happen.” His comments were reported in a post by Wall Street Journal Fed reporter Nick Timiraos.
