Bitunix Analyst: Hassett Directly Points Out Fed's "Severely Lagging Rate Cuts" as Policy Timing Dispute Emerges

BlockBeats News, December 24 — Kevin Hassett, Director of the White House National Economic Council and considered one of the frontrunners for the next Federal Reserve Chair, has recently publicly criticized the Fed's pace of rate cuts, bluntly stating that the United States has "fallen seriously behind global central banks" in this round of monetary easing. Even though the U.S. GDP annualized growth rate reached 4.3% in the third quarter, significantly exceeding market expectations, Hassett still believes that monetary policy has failed to respond in a timely manner to structural changes. He pointed out that the wave of investment in artificial intelligence is boosting productivity while exerting medium-term downward pressure on inflation, which is reducing the rationale for maintaining excessively high real interest rates. He also emphasized that, compared to other major global central banks, the U.S.'s hesitation in policy shifts has gradually resulted in a relatively tight stance. Although the Fed has cut rates three times this year and lowered them by another 25 basis points in December, there have been the most dissenting votes internally since 2019, indicating a significant widening of decision-making disagreements.

On the political front, Trump continues to exert pressure, demanding faster and larger rate cuts, and is about to announce a new nominee for Fed Chair, making the independence and direction of monetary policy a major focus of market attention. While Hassett emphasizes respect for central bank independence, his position clearly indicates a preference for growth-oriented policy thinking.

Bitunix Analyst:

From the perspective of the overall economic structure, the United States is currently in a critical transitional period of "strong data, but changing trends." AI-driven investment and productivity improvements are rewriting the traditional relationship between inflation and economic growth, while high interest rates continue to put pressure on low- and middle-income groups and small and medium-sized enterprises. The real risk of current policy is not easing too early, but rather choosing to wait and see when structural inflation slowdown has already become a trend, ultimately forcing a more drastic correction in the future. This is also an important background for why the market has started to price in a "policy lag correction" in advance.