Treasury Secretary Scott Bessent said the Trump administration's focus with regard to bringing down borrowing costs is
"He and I are focused on the 10-year Treasury," Bessent said in an interview with Fox Business Wednesday when asked about whether President Donald Trump wants
Bessent repeated his view that, by expanding the supply of energy, that will bring down inflation. In terms of working-class Americans, "the energy component for them is one of the surest indicators for long-term inflation expectations," he said.
"So if we can get gasoline back down, heating oil back down, then those consumers not only will be saving money, but their optimism for the future will" help them rebuild from the recent years of high inflation, Bessent said.
The former hedge fund manager also said that, with regard to the Fed, "I will only talk about what they've done, not what I think they should do from now on." He said that 10-year Treasury yields climbed after the Fed's "jumbo rate cut," referring to the 50 basis-point reduction that Chair Jerome Powell and his colleagues enacted in September.
While the Fed's short-term benchmark serves as a key reference for money markets, 10-year Treasuries are a benchmark for 30-year mortgage rates along with other key borrowing rates.
After the Fed left its benchmark unchanged last week, Trump blasted the US central bank in a social media post for having "failed to stop the problem they created" with the surge in prices. But he stopped short of the overt policy actions that he pressed the Fed to implement at times during his first administration.
The president believes if energy prices are brought down, the tax-cut extensions the administration is working toward are enacted, and the economy is deregulated, "then rates will take care of themselves, and the dollar will take care of itself," Bessent said.
Interviewed by Lawrence Kudlow, who served as Trump's White House National Economic Council director in his first term, Bessent repeated his economic policy mantra of 3-3-3 — referring to getting the fiscal deficit down to 3% of gross domestic product from above 6% in recent years, boosting oil production by 3 million barrels a day, and sustaining economic growth at 3%.
"Now that I'm in the seat, I believe in it more than ever," Bessent said of the 3-3-3 program. He added that while government spending had boosted the economic expansion under former President Joe Biden, what the new team is aiming for is private-sector led growth, fueled by capital spending and a return of manufacturing jobs from overseas.
Asked about the work of Elon Musk's DOGE group with respect to the Treasury and its access to the department's critical payments systems, Bessent reiterated a message the Treasury communicated earlier in the week — that those individuals aren't making the decision on curtailing any payments.
"At the Treasury, our payments system is not being touched," he underscored. "There's a study being done. Can we have more accountability, more accuracy, more traceability, that the money is going where it is," he said.
The so-called Department of Government Efficiency's broader effort to address efficiency "is not going to fail," Bessent said.
Asked about
"President Trump has a mandate. He came in to do big things, and one of the big things that this administration wants to do is make the 2017 Tax Cuts and Jobs Act permanent," Bessent said. "That permanency will continue to make the US the No. 1 economy in the world in terms of growth."