Bessent accuses Fed of ‘politically biased' forecasts, Fed pushes back
"The Fed publishes something called a summary of economic projections, and it's pretty politically biased," Bessent said. He was referring to the Fed's widely followed quarterly projections that reflect the views of its 19 policymakers on key economic indicators including interest rates.
Bessent said the forecasts amount to expectations for just one or two quarter-point interest-rate cuts this year, which he claimed does not reflect current economic realities. President Donald Trump has called for an immediate 300 basis-point rate cut to boost growth.
The summary of economic projections, released after each Fed policy meeting, does not attribute forecasts to individual policymakers. In June, eight officials projected two rate cuts in 2025, seven saw no change, two expected one cut, and two projected three.
Several of Trump's appointees to the Fed, including Governor Christopher Waller and Vice Chair for Supervision Michelle Bowman, have publicly backed a rate cut this month based on economic data. However, Fed Chair Jerome Powell, also a Trump appointee, has not indicated support for such a move.
The Fed has consistently rejected claims of political influence, maintaining that its policy decisions are guided by its dual mandate of maximum employment and price stability.
'Politics play no role in our decisions,' a Fed spokesperson said. 'Suggesting otherwise undermines the credibility of the institution and the effectiveness of monetary policy.'
The Trump administration has increased its pressure on the central bank in recent months, arguing that high interest rates are stifling investment and job creation as the 2026 presidential campaign cycle begins to take shape.
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