Trump's Treasury Secretary reveals the 'missing ingredient' for economic growth
The Donald Trump administration has been flaunting a real GDP growth rate of 4.3% in the third quarter of 2025 as a saving grace in the face of criticism over affordability and tariffs. According to Trump's Treasury Secretary Scott Bessent, the key ingredient of helping the economy grow will be rate cuts, which he urged the Federal Reserve to look into without delay.
As per a CNBC report, the Republican said this in a speech before the Economic Club of Minnesota. Bessent defended President Trump’s economic policies, which have come under heavy fire from a big part of the population of late. He believes that easier monetary policies will be the way ahead for the country to grow. The Fed approved three consecutive interest rate cuts in the final four months of 2025, which took the central bank’s key interest rate down to a range of 3.5%-3.75%.
“Cutting interest rates will have a tangible impact on the lives of every Minnesotan,” he said, before adding, “It is the only ingredient missing for even stronger economic growth. Which is why the Fed should not delay.” The situation in Minnesota is tense after recent events, and Bessent might not be very popular in the area given his allegiances. However, that did not stop him from urging the US Fed to keep an open mind.
“I believe the Fed needs to have merely an open mind. The open-minded maestro, former Fed Chairman Alan Greenspan, resisted premature rate hikes during the technology boom of the 1990s—and history proved him right,” he added. Although the Fed had approved of three quick rate cuts towards the end of last year, the trend is unlikely to continue. Reductions are all set to slow this year.
With markets pricing in just two cuts and the most recent projections from Fed officials pointing to just one, it seems like a difficult task. There is no doubt that cutting interest rates will help a number of citizens who wish to depend on credit to make ends meet for the time being. It would give them some much-needed purchasing power in the short term. However, slashing rates comes with a different set of potential problems.
Lower interest rates may adversely affect inflation by ramping it up as people’s purchasing power increases. However, Bessent is adamant, and Americans will reap the rewards of Trump’s policies in 2026. “In 2025, the President laid the foundation for robust economic growth with: the historic passage of the One Big Beautiful Bill, trade deals that rewrote decades of global misalignment; and an ambitious deregulation agenda that empowered American entrepreneurs and businesses,” he said. “Now, in 2026, we will reap the rewards of President Trump’s America First agenda.”
More on Market Realist:
Trump's bid to control US Fed might lead to 'fiscal dominance' — and that's not good news
A top Trump official finally has some good news about grocery costs in 2026
Trump admin can 'recreate the exact tariff structure' even if Supreme Court rules against it
