Bessent Urges Fed to Keep Open Mind on US Inflation Outlook

September 27, 2026 at 09:19 PM2 min

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Treasury Secretary Scott Bessent said Federal Reserve policymakers should keep an "open mind" on interest rates, arguing that productivity gains from artificial intelligence and deregulation will help keep US inflation in check. He framed his comment in the context of a US economy thriving under President Donald Trump, even as elevated fuel prices spurred by the conflict with Iran weigh on US voters ahead of midterm elections in November.

Key Facts

Bessent said Fed policymakers should keep an "open mind" on interest rates, citing productivity gains from AI and deregulation.
US consumer prices excluding food and energy climbed 0.3% in August and advanced 2.4% on an annual basis, according to government data released Sept. 11.
The Fed under Chairman Kevin Warsh raised its benchmark rate for the first time since 2023 days after the inflation data.
Bessent said he expects Iranian oil deliveries to China to stop within two weeks, with only 15 million more barrels of Iranian oil on the water.

Fed Policy Stance

Bessent argued that productivity gains from artificial intelligence and deregulation will help keep US inflation in check. He said Fed Chairman Kevin Warsh is "well aware" that the US economy is seeing gains similar to "if not more substantial" than when Alan Greenspan was Fed chair during the 1990s internet boom. Greenspan "let things run," and "the board and the voters on the Fed should have an open mind because, again, it's the deregulatory aspect," Bessent said.

Inflation Drivers

Inflation this year has been driven by record-high diesel and gasoline prices linked to the Iran war and Ukrainian attacks on Russia's energy industry. US consumer prices excluding food and energy climbed 0.3% in August and advanced 2.4% on an annual basis, according to government data released Sept. 11. Days later, the Fed under Warsh raised its benchmark rate for the first time since 2023. Bessent argued that "core inflation has been very quiescent, and is has actually dropped over the past few months."

Iran Oil Deliveries

Asked about China's role surrounding the Iran war, Bessent said he expects Iranian oil deliveries to China to stop soon. "China has substantially reduced any assistance to Iran" and "there's only 15 million more barrels of Iranian oil on the water," he said. "Probably within the next two weeks they're going to make their final delivery of oil to China and then they will have nothing."