Hassett says Fed should not raise interest rates and may have room to cut them

The director of the White House National Economic Council, Kevin Hassett, assessed this Friday (5) that the Fed (Federal Reserve) has no reason to raise interest rates and could even gain space to reduce them in the coming months, despite the stronger than expected result of the May payroll.

In an interview with CNBC, Hassett stated that the labor market data was positive and reinforces the resilience of the American economy.

"The job creation numbers were good", said the adviser to the president of the United States, after the release of the report that showed job openings above expectations and positive revisions for the previous months.

According to Hassett, the American central bank can afford to observe price developments before deciding any change in monetary policy.

"The Fed can monitor inflation and wait before taking any action," he said. In the advisor's assessment, the monetary authority "should not raise interest rates" and may find conditions to initiate cuts in the future, but he did not provide further details.

Hassett also commented on the behavior of the energy market, at a time when investors are following geopolitical tensions in the Middle East, which have boosted oil prices. While he acknowledged that stocks of the US energy commodity have been falling recently, he highlighted that levels remain "historically high".

In addition, the White House director minimized the risk of a persistent rise in commodity prices.

"Oil prices won't stay high forever," he said, suggesting that any inflationary pressures linked to energy tend to be temporary.

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Source: CNN