Kevin Hassett told CBS’s Face the Nation that while headline inflation remains elevated (CPI +3% y/y; PCE +2.8% y/y), the administration sees disinflationary momentum in key micro components (e.g., prescription drugs, gasoline, groceries) and in macro drivers — the deficit is running about $600 billion lower than last year and the trade deficit has been cut roughly in half, which he argues should help push inflation toward the Fed’s 2% target. He highlighted strong near‑term growth and consumer outcomes — GDP around 4% and real income up roughly $1,200 per family this year, citing record Black Friday spending — but acknowledged consumer sentiment and hiring signals are mixed and said he’s awaiting upcoming household employment data before drawing firm conclusions. On energy, Hassett said U.S. action to curb black‑market shipments to sanctioned countries (e.g., Venezuela) is unlikely to move global oil prices materially, and on monetary policy he said he would consult frequently with the president if he were Fed chair while stressing that the Fed’s votes, not the president’s views, determine policy.
Headline inflation remains meaningfully above the Fed’s target with CPI at +3.0% year-over-year and PCE at +2.8% y/y, yet the administration points to disinflationary micro-moves: prescription drugs, which rose 9% earlier in the term, are down 0.6 percentage points so far this year, gasoline is “way down,” and the grocery package has retreated from prior peaks. Fiscal and external balances are cited as macro tailwinds — the deficit is running roughly $600 billion lower than last year and the trade deficit has been cut about in half — which the administration argues should help push inflation toward 2%. Economic demand data cited by the administration show near-term strength: GDP is described as about 4% and real income is up roughly $1,200 per family this year, supported by record Black Friday spending, but consumer sentiment lags and essential costs (groceries) remain elevated versus earlier baselines. Labor and market risks remain ambiguous: the Fed flagged slowing job gains, the Business Roundtable survey shows CEOs expect employment declines in 2026, and Hassett is waiting for upcoming household employment data to form a clearer view. Geopolitical actions against Venezuelan black‑market oil are expected by the administration to have limited global price impact, and Hassett affirmed Fed independence while noting he would consult frequently with the president if appointed Fed chair — a political dynamic investors should monitor for policy signaling.
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