Bessent backs Warsh on ending forward guidance, rejects dot-plot predictions

U.S. Treasury Secretary Scott Bessent reiterated his support for Fed Chair Kevin Warsh's push to move away from forward guidance, arguing the Federal Reserve's dot-plot rate projections foster groupthink and are often wrong. He said he now meets Warsh for breakfast every week and views regular Treasury-Fed discussions as important for exchanging views on the economy, regulation and policy challenges. Bessent also said he is confident the U.S. economy can return to a path of 3% growth. He argued the Fed should remain open-minded about inflation as energy-price increases tied to Iran recede and said productivity gains from artificial intelligence could help support faster GDP growth without traditional price pressures, echoing Alan Greenspan's 1990s view. Beyond monetary policy, Bessent promoted Trump Accounts, tax-deferred index-fund investment accounts for children created under the One Big Beautiful Bill Act of 2025. He said the program is meant to address the fact that 38% of U.S. households have no stake in equity markets. Children born between Jan. 1, 2025 and Dec. 31, 2028 are eligible for a $1,000 Treasury seed investment, with accounts opening for additional deposits on July 4, and families, friends and employers can contribute up to $5,000 a year per child. He also highlighted Michael and Susan Dell's $6.25 billion commitment to provide $250 to children in the bottom 80% of zip codes by income. A separate reference said Bessent made major economic predictions at the Economic Club of New York, but provided no additional details on the substance, timing or market impact of those remarks.