Bessent says services, not tariffs, driving inflation; forecasts ~3% 2025 GDP in CBS interview
Treasury Secretary Scott Bessent told Face the Nation on Dec. 7 that services — not tariffs or imported‑goods prices — are driving current inflation, citing PCE inflation at about 2.9% versus roughly 1.8% for imported goods. He said the holiday season is "very strong across all income cohorts," noted real incomes are up about 1% and GDP ran near 4% in a couple of quarters, and forecast the U.S. will finish 2025 with roughly 3% real GDP growth despite the Schumer shutdown.
📌 Key Facts
- In a Dec. 7, 2025 Face the Nation (CBS) interview, Treasury Secretary Scott Bessent said services, not tariffs, are driving current inflation.
- Bessent contrasted personal consumption expenditures (PCE) inflation at roughly 2.9% with imported‑goods inflation around 1.8% to support that conclusion.
- He reiterated that imported‑goods inflation is below overall inflation and pushed back on tariff‑driven price examples raised in the exchange (e.g., the Tonka toy example).
- Bessent forecast the U.S. will finish 2025 with about 3% real GDP growth despite the Schumer shutdown.
- He noted the economy ran at roughly 4% GDP growth in a couple of quarters this year.
- Bessent said real (inflation‑adjusted) incomes are up about 1%.
- He characterized holiday spending as "very strong across all income cohorts" and disputed predictions of sharply fewer purchases.
📊 Relevant Data
In the 12 months ending September 2025, U.S. services inflation was 3.6%, compared to 1.9% for commodities.
Consumer Price Index - September 2025 — Bureau of Labor Statistics
Shelter costs contributed 1.7 percentage points to the overall 3.0% inflation rate in September 2025.
What are the biggest drivers of inflation in the past year? — USAFacts
U.S. import prices for nonfuel goods rose 0.8% in the 12 months ending September 2025.
U.S. Import and Export Price Indexes summary - 2025 M09 Results — Bureau of Labor Statistics
In 2023 and 2024, inflation-adjusted wages for the bottom quarter of workers rose at a yearly rate of 3.9%, compared to 3.1% for the top quarter.
The K-shaped economy means inflation hurts at the bottom ... — Fortune
📰 Sources (3)
- Direct on‑air quote: Bessent contrasted PCE inflation (~2.9%) with imported‑goods inflation (~1.8%), saying services are driving inflation.
- Bessent forecast the U.S. will 'finish the year' with about 3% real GDP growth 'despite the Schumer shutdown,' and said GDP ran at ~4% in a couple of quarters.
- He characterized holiday spending as 'very strong across all income cohorts' and pushed back on predictions of sharply fewer purchases.
- Contextual exchange on tariffs and prices (e.g., Tonka toy price example), with Bessent reiterating that imported goods inflation is below overall inflation.
- Bessent said the holiday season is 'very strong' across income cohorts.
- He forecast the U.S. will finish 2025 with about 3% real GDP growth despite the shutdown.
- He cited PCE inflation at roughly 2.9% and imported-goods inflation at ~1.8%, saying services are driving inflation rather than tariffs.
- He said real incomes are up about 1%.
- He noted the economy saw '4% GDP growth' in a couple of quarters and argued affordability concerns stem from embedded inflation from prior years.