- On Iran blockade says anything that is taken off will be taken off slowly
- There are 3 scenarios on Iran: deal, no deal, or kinetic action
- There’s more we can do on Iran if we have to
- See real wage growth to resume, on the other side of the war
- 100% approve of the Fed getting rid of forward guidance
- Rates peaked the day before Warsh was sworn in
- People have a wrong notion of what a strong dollar means
- A strong dollar means doing the right things for the economy
- When asked about maintaining the dollar as a reserve currency he said nothing has changed
US Treasury Secretary Scott Bessent said the administration remains committed to pursuing a diplomatic resolution with Iran but warned that alternative options remain on the table if negotiations fail, while also offering a robust defense of the Federal Reserve’s evolving policy framework and the long-term strength of the US dollar.
Speaking about ongoing discussions with Iran, Bessent indicated that any easing of restrictions related to the US naval blockade would be implemented gradually rather than all at once.
He outlined what he described as three possible paths forward for the standoff with Iran: a negotiated agreement, a failure to reach a deal, or military action.
While emphasizing the administration’s preference for diplomacy, Bessent stressed that the US retains additional tools if negotiations break down.
On the domestic economy, Bessent struck an optimistic tone, arguing that real wage growth could strengthen once the current geopolitical conflict subsides and uncertainty begins to fade.
Bessent also weighed in on monetary policy, offering strong support for the Federal Reserve’s decision to move away from explicit forward guidance as a central communication tool.
The comments reflect a growing view among some policymakers that excessive reliance on pre-signaled policy paths can reduce flexibility and create market distortions when economic conditions change unexpectedly. Bessent suggested that a more data-dependent approach allows policymakers to respond more effectively to evolving economic circumstances.
Turning to the dollar, Bessent rejected what he described as common misconceptions about currency strength. Rather than focusing solely on the exchange rate, Bessent argued that a strong dollar should be understood as the product of sound economic policy, sustainable growth, and confidence in US institutions.
His remarks come amid ongoing debate over whether a stronger or weaker currency better serves US economic interests. Bessent’s comments suggest the administration continues to view the dollar’s strength as a reflection of broader economic fundamentals rather than a specific exchange-rate target.
When asked about maintaining the dollar’s status as the world’s primary reserve currency, Bessent sought to reassure markets that there had been no change in policy.
The statement is likely aimed at reinforcing confidence in the dollar’s central role in global finance at a time when some geopolitical rivals have sought to reduce their dependence on the US currency for international trade and reserves.
