Fed rate cut pressure grows after Bessent remarks

Editorial analysis of Scott Bessent’s call for a rapid rate cut and what it means for policy and markets.

Bessent pushes a half point rate cut at next Fed meeting

US treasury secretary Scott Bessent has urged a half-point rate cut at the Federal Reserve meeting scheduled for September 16-17. He argues that a larger cut is needed to support growth while inflation remains stubbornly steady, a stance that has helped lift global stock markets and weigh on the dollar. Investors have reflected this optimism by pricing in the possibility of further easing through the remainder of 2025 and into 2026, pushing major indices to new highs on the back of rate-cut expectations.

The moment shows how market sentiment is shaping policy expectations. A push for a bigger, faster easing cycle tests the Fed’s independence as traders trade data for decisions. If policy moves come mainly in response to financial market signals, credibility could suffer if inflation proves stickier than hoped. At the same time, political voices—including voices from the administration and opponents who want relief now—add pressure that can blur the line between data-driven decisions and political signaling. The result could be a delicate balancing act where growth is supported but price stability remains the benchmark to meet.

Highlights

Policy decisions will hinge on data, not appearances.