Investing.com-- U.S. Treasury Secretary Scott Bessent did not rule out the possibility of recession when speaking to NBC News’ “Meet the Press” on Sunday, flagging some near-term economic turbulence as the Trump administration carries out its agenda.
Bessent also said he was not worried about a recent correction in stock markets, stating that it was healthy for the market to decline, and that overly euphoric markets caused financial crises.
On the topic of a recession, Bessent did not outright downplay the possibility of an economic contraction, stating that there were no guarantees with the economy.
“So I can predict that we are putting in robust policies that will be durable, and could there be an adjustment,” Bessent told NBC, adding that the country needed to be weaned off of “massive government spending.”
Bessent’s comments come after President Donald Trump also declined to rule out the possibility of a recession in a recent interview with Fox News. Trump had warned that the country may be in for some economic turbulence as he carries out his agenda of trade tariffs, government spending cuts and lower taxes.
But Trump’s tariff agenda- especially his flip-flopping over tariffs on major trading partners- has been a key point of uncertainty for markets, amid fears that the tariffs could underpin inflation while quashing consumption- a scenario that bodes poorly for the world’s biggest economy.
Trump’s first two months in office were marked by a sustained decline in stock markets, with the S&P 500 sliding into correction territory last week from its late-2024 peaks.
The 47th President signed a barrage of executive orders since taking office in late-January, with several orders aimed at exploring more trade tariffs. Trump has so far imposed a 20% duty against China, 25% duties on some Canadian and Mexican goods, and has also imposed tariffs on metal imports.