Federal Reserve’s Quarter-Point Rate Cut Seen as a ‘Smart Move’ by White House Economic Advisor
September 18, 2025 — The Fed cut its borrowing rate by 0.25%. The White House sees the move as wise. White House advisor Kevin Hassett told CNBC on Thursday that the decision fits a careful style of managing the economy.
A Steady and Careful Move
The FOMC voted to drop rates by 25 basis points. Most members agreed. Some in the administration wanted a deeper cut. New Fed Governor Stephen Miran, known from the Council of Economic Advisers, pressed for a 50 basis-point cut. But the vote came out 11 to 1, and his view did not win.
Hassett said that the cut builds slow progress. He said policymakers will watch each new piece of data before they act again. On CNBC’s Squawk Box, he said:
“Moving kind of slow and steady and heading towards a target, watch the data come in, that’s what prudent policy is.”
He added that although Miran wanted a deeper cut, the 0.25% drop marks a sound start if further cuts are needed.
In the White House and Market
President Donald Trump, who picked Miran for the Fed, has not yet shared his view on this choice. In the past, Trump has been critical of the Fed and has pressed for faster and larger cuts. He even called Fed Chair Jerome Powell “Too Late” for a slow pace in meeting economic needs.
The president has asked for cuts up to 3 percentage points. His view stands apart from the latest FOMC plans. Trump often points to the slow U.S. housing market and the rising federal debt, which now nears $37 trillion.
Economic Prospects: Growth, Price Rise, and a Fine-Tuned Plan
Hassett pointed out that the Fed faces a tough task. The U.S. economy grew above 3% in the third quarter. Such growth usually makes a rate cut less likely. Yet, price rise stays above the 2% goal, although it shows signs of slowing down.
With mixed signals, Hassett said it makes sense for Fed members to look at all the models and listen to many views. He asked, “What can we do in an economy that is growing and has inflation slowing but still above target?”
Hassett called the 0.25% cut a careful balance—a move that shows hope without taking a big risk in pushing up prices.
Looking Ahead: Fed Chair Hints
Some see Kevin Hassett as a strong choice to take over from Jerome Powell next year. His words show a preference for a plan built on clear data and many opinions on the economy.
Summary of Key Points:
- The Fed dropped its main rate by 0.25% as a careful measure.
- White House advisor Kevin Hassett called the move smart.
- Fed Governor Stephen Miran had asked for a 0.50% drop, but most members disagreed.
- President Trump has often pushed for deeper cuts, though he did not comment on this move.
- The U.S. economy grew over 3% even as inflation stayed above 2%.
- Hassett stressed the need to view multiple data points and ideas.
- Hassett is seen as a likely candidate for Fed Chair next year.
For more news on economic changes and the Fed’s plans, follow CNBC’s live updates and expert chats.
Watch the full interview with Kevin Hassett on CNBC’s Squawk Box for more in-depth details.
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