Trump is focused on lowering bond yields, not fighting the Fed, Treasury chief says

• President Trump isn't focused on getting the Fed to cut interest rates, Treasury Secretary Scott Bessent said.
• The White House is instead looking at the 10-year Treasury yield, he said.

The Trump administration isn't looking to clash with the Federal Reserve over interest rates, Treasury Secretary Scott Bessent told said. Instead, the focus of the White House is on lowering Treasury yields as a way to ease borrowing costs.

"He and I are focused on the 10-year Treasury, and what is the yield of that," Bessent told Fox Business. "He wants lower rates. He is not calling for the Fed to lower rates."

The remarks are a shift in tone compared to recent comments from the president, who, until recently, has been an outspoken critic of the Fed's policy approach.

Although the central bank has cut the fed funds rate by a full percentage point since September, the president has pressed for more easing. During his speech at the World Economic Forum in Davos last month, Trump said he would "demand that interest rates drop immediately."

Regardless, some analysts expect things to potentially go a lot differently this year. Inflation risks tied to Trump's protectionist trade policies could put the Fed on pause or even prompt a rate hike.

Still, the 10-year Treasury yield is a lending benchmark for things like the 30-year mortgage, and lower yields could help influence consumer borrowing costs to come down.

Yields fall when bond prices rise, meaning the Trump administration will need to boost Treasury demand to achieve its aims. So far, the 10-year rate jumped aggressively at the start of 2025 on worries that inflation and the national debt would rise amid Trump's expansionary platform.

But Bessent argued that the administration is creating an environment that's welcoming to bond traders.

"We cut the spending, we cut the size of government, we get more efficiency in government, and we're going to go into a good interest rate cycle," Bessent said. He noted these as factors for why bond yields have been falling, hitting their lowest point of 2025 this week.

The Treasury secretary emphasized that inflation would come down once energy prices fall. Trump has indicated his aim is unleash a new fossil fuel boom, and encourage US oil firms to "drill, baby drill." He's also called on the Organization of Petroleum Exporting Countries to unleash more supply to help lower prices.

"So if we can get gasoline back down, heating oil back down, then those consumers not only will be saving money, but their optimism for the future will" help them rebuild from the recent years of high inflation, Bessent said.

It's to be seen whether White House actions succeed in lowering energy prices, as US producers are already pumping historic amounts of crude oil. Officials from Saudi Arabia, the leader of OPEC, have indicated that they will not follow Trump's request to boost output.