Fed Rate Cut Expected Next Week After Kevin Hassett’s Alert

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Kevin Hassett has caught the market’s attention.

In a new Fox News interview, the White House economic adviser said the Federal Reserve is “likely” to cut interest rates at next week’s meeting. Coming from someone seen as the leading contender to become the next Fed Chair, his words carry extra weight.

Hassett expects a 25-basis-point cut, saying recent comments from Fed governors and regional presidents suggest momentum is shifting.

“They now seem much more like they’re leaning in the direction of a rate cut,” he said, adding that he hopes to “get to a much lower rate” over time.

Economists, Markets, and FedWatch Point to a December Cut

Next week’s meeting is the last of 2025, and expectations for a rate cut have surged.

• A Reuters poll shows 82% of economists expect a 25-bps cut.
• FedWatch now places the odds at 87.2%.
• Senior officials including John Williams, Michelle Bowman, Christopher Waller, and Stephen Miran have signaled support for easing.

Still, not everyone agrees.

At least five FOMC voting members have publicly opposed another cut, and chair Jerome Powell recently warned that inflation could reignite. With inflation stuck above 2% and key data disrupted by a 43-day government shutdown, the divide reflects a rare level of uncertainty heading into a meeting.

A Cut With Global Ripple Effects

A December move wouldn’t just influence U.S. borrowing costs.

Asian currencies – including the rupee, won, rupiah, and peso – have been under pressure for weeks, and strategists say Fed easing could offer immediate relief. Some analysts even argue it may be “time to go long Asian currencies,” pointing to expectations of a stronger yuan.

What to Watch Next

All eyes now turn to next week’s FOMC decision. A 25-bps cut would set the tone for 2026 and, with Hassett rising as Trump’s likely choice for the next Fed Chair, the political and market stakes are unusually high.