“This is all supply-side stuff, which should increase supply, put downward pressure on prices,” Hassett said. “It’s not a Phillips curve kind of thing where there’s government throwing money at things, and that’s creating jobs. And so if I were at the Fed right now, I would either hold steady or cut rates because there’s so much supply-side momentum.”

Investors see few prospects for rate cuts, given that inflation has been well above the Fed’s 2% target. Bond market prices indicate that traders see it as a 50-50 proposition whether the central bank will hike rates at its next meeting in September and as highly likely that it will raise its interest rate target sometime this year. Warsh has faced some criticism from Fed watchers for declining to spell out how he will address the market expectations for rate hikes.

A major problem for Warsh is that Trump has long sought for the Fed to pursue lower rates. Trump harshly criticized Warsh’s predecessor, Jerome Powell, over his resistance to easier monetary policy. His campaign against Powell included threats to fire him and accusations that he mismanaged the finances of construction projects at the central bank.

In recent weeks, Trump has indicated that he will give some leeway to Warsh. He has stated that he prefers lower rates but directed pressure away from Warsh by suggesting that other members of the monetary policy committee are the obstacle to easier money.

Hassett was on the network to discuss Friday’s jobs report, which was a major disappointment. Most forecasters had expected positive employment growth, but the economy actually lost 23,000 payroll jobs in July, the Bureau of Labor Statistics reported.

The gains from the previous two months’ reports were also revised down, pointing to an overall slowdown in hiring.

Also, the unemployment rate declined slightly to 4.1%, although that drop in the unemployment rate was because labor force participation declined last month.

Hassett mentioned “special factors” at play for the report.

“The consensus was it would be plus 88,000, which I think is consistent with everything else we’ve seen, which means it’s a pretty strong economy,” Hassett said. “And the reason it got negative was there was a big decline in government workers and people who were leaving hospitality because of the World Cup.”

Hassett also talked about the matter of Lisa Cook, the Fed governor whom Trump has been trying to fire. The legal battle over her position went all the way to the Supreme Court.

Last year, Trump tried to remove her from the central bank over allegations of mortgage fraud, but the courts prevented him from doing so. Last week, the White House sent her a letter saying there was “sufficient reason to believe” she had made false statements on one or more mortgage applications and requesting a response with supporting evidence.

Hassett said the situation is a “law enforcement matter” and that he looks forward to seeing what she has to say. He also said he hopes that Cook is innocent, as she claims.

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Cook has been aware of the allegations since at least Aug. 25, 2025, but she has not explained herself, according to the White House letter.

“Even though it has been over 10 months, you have never provided an explanation for this serious misconduct,” the letter reads. “This is your opportunity to respond.”