Treasury Secretary Scott Bessent Calls for Major Federal Reserve Reforms

U.S. Treasury Secretary Scott Bessent advocates for comprehensive reform of the Federal Reserve, criticizing its interest rate policies and calling for a reduction in its economic influence. The proposed changes align with the Trump administration's goals to install allies within the Fed and alter its current trajectory.

U.S. Treasury Secretary Scott Bessent has called for a reevaluation of the Federal Reserve's influence, particularly its interest rate-setting abilities, as part of the Trump administration's push for greater control over the institution. He expressed concerns over the Fed's policies, stating they exacerbate inflation and economic inequality.

In a Wall Street Journal article, Bessent advocated for the Fed to relinquish bank supervision duties to other government entities and reduce its economic impact, such as bond purchases made outside of crisis situations. He criticized the central bank for alleged partisanship and suggested an overhaul to restore its independence.

As President Trump seeks to replace current Fed Chair Jerome Powell, Bessent's proposals echo administration-backed calls for leadership changes at the Fed. The White House has hinted at potential successors, including National Economic Council Director Kevin Hassett and Fed Governor Christopher Waller, amid ongoing debates over interest rate cuts and economic strategy.

(With inputs from agencies.)