U.S. Treasury Secretary Besson’s recent remarks have thrown a wrench into the Federal Reserve’s economic outlook, reigniting concerns about the central bank’s policy independence and transparency.

The controversy stems from the Fed’s June report, which laid out its projections for interest rates through the end of this year. The report highlighted a clear lack of consensus among policymakers: 8 officials expected two rate cuts, 2 forecasted just one, 7 anticipated no cuts at all, and 2 believed there could be as many as three. The split in opinion underscores a deeper uncertainty within the central bank, and raises questions over a coherent direction in monetary policy.

Besson didn’t hold back, suggesting these differing views weren’t solely based on economic analysis. Instead, he believes politics are seeping into policy decisions. With former President Trump having publicly called for “an immediate 3-point rate cut” on several occasions, Besson questioned whether the Fed’s outlook is truly free from political pressure. This, in turn, casts doubt on both the Fed’s credibility and on the reliability of its policy signals—creating further uncertainty for the markets.

Beyond rate projections, Besson also criticized how the Fed assesses the inflationary impact of tariffs. He pointed out that while there’s been growing market chatter about potential inflation risks linked to tariffs, in practice, inflation has remained relatively contained. This suggests the Fed may be overly pessimistic in how it’s factoring trade policy into its economic framework.

Besson also expressed concern about the Fed’s increasing involvement in areas beyond traditional monetary policy. He warned that expanding into non-core functions could undermine the institution’s ability to carry out its main mission: maintaining economic stability and price control. According to him, the more the central bank strays from this focus, the more its independence and effectiveness may be diluted.

Markets have been mixed in their reaction. The Dow Jones Industrial Average closed up 507 points at 45,010, with both the S&P 500 and Nasdaq also recording gains—largely driven by optimism surrounding U.S.-Europe trade negotiations. Still, when it comes to the Fed’s future path—particularly regarding interest rates—investors are showing signs of caution.

With the U.S. presidential election drawing closer, political pressure on the central bank is expected to intensify. In the months ahead, the Fed’s ability to hold the line on independence and maintain clear, credible communication is likely to become a central theme for markets. For investors, it’s a timely reminder that political currents can no longer be ignored when assessing the outlook for interest rates and financial markets.