Kevin Hassett, Director of the U.S. National Economic Council, Says Latest Inflation Report is One of the Best He Has Ever Seen
Kevin Hassett, Director of the U.S. National Economic Council, stated that the latest inflation report is one of the best he has seen in his career, noting that not only are energy prices lowering inflation, but also prices for drugs, rent, and insurance are decreasing.
Market mechanisms are reinforcing soft landing expectations through positive narratives, maintaining risk asset allocations, and falling bond yields are boosting stock market valuations. The market is becoming more optimistic about the Federal Reserve's policy path, benefiting from cyclical stocks and consumer-related sectors.
Source: Public Information
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Kevin Hassett, in his past role as an economic advisor, participated in Trump administration policies and emphasized the impact of supply-side reforms on controlling inflation, similar to his earlier optimistic assessments of tax reform and deregulation effects.
On the capital path, his statements guide the market to lower inflation concerns, with resources continuing to tilt towards growth-sensitive assets, motivated by consolidating the White House's economic narrative and supporting policy continuity.
Similar to market reactions during the 2023-2024 inflation decline period, the current U.S. economy is in a phase of confidence recovery driven by multidimensional price decreases.
Essentially, this is a regulatory change; the strengthening of the White House's economic narrative is affecting market inflation expectation management. The mechanism is that the accumulation of evidence for broad price declines reduces the necessity for tightening, promoting efficient capital allocation towards consumption and investment sectors that benefit from a low-inflation environment.
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- Multidimensional price declines consolidate soft landing.
- Optimistic narratives guide capital risk appetite.
- Supply-side improvements reshape inflation path.