Treasury Secretary Scott Bessent’s interview with CNBC on Oct. 28, 2026

Treasury Secretary Scott Bessent said Wednesday that the Federal Reserve hiking interest rates in the future wouldn’t necessarily be a mistake.

After CNBC’s Brian Sullivan asked if the further rate increases in the future would constitute a monetary policy error, Bessent responded: “That’s not necessarily so.”

Bessent’s comments came hours after the Fed announced it would keep interest rates unchanged at its October gathering, as the market widely expected.

Bessent is a key confidant of President Donald Trump, who has repeatedly called for lower interest rates. Trump pressured Fed Chairman Kevin Warsh’s predeccesor, Jerome Powell, over the issue during Powell’s final months at the helm of the central bank.

But Bessent said Wednesday that both he and Trump believe Warsh is doing well and can strike a balance between ensuring full employment and stable prices.

“I think Chair Warsh is off to a great start,” Bessent said. “As I often say, I have great confidence in him.”

The Fed’s decision to hold rates steady came a month after it lifted borrowing costs for the first time in three years. Fed funds futures traders widely expected the central bank to return to rate hiking when it meets again in December.

Bessent said he would like to see the Fed have an “open mind” about the supply shock from energy prices having a “transitory nature.” The U.S. war with Iran has led to a sharp drop in global crude production volumes, in turn leading annual inflation readings to move further from the Fed’s target of 2%.

Bessent also said the U.S. efforts to isolate the Iran economy dubbed Operation Economic Outcast has been “very successful.” He said internal estimates show that Iran’s economy could contract by as much as 25% from March 2025 to March 2026.