Hassett: Hormuz Reopening Target in 2 Months Strengthens Fed Cut Narrative
National Economic Council Director Kevin Hassett said the Federal Reserve's prospects for a rate cut are "very solid," assessing that reopening the Strait of Hormuz could be achieved within two months with "contingency plans" in place.
In an interview with Fox Business on Friday (April 10), Hassett stated that the government expects a rapid decline in energy prices after Hormuz reopens. He added that current shipping flows are only about 10% of normal levels.
For the market, Hassett's message connects two main channels: the normalization of Hormuz flows is projected to ease pressures on energy prices and inflation, which in turn could strengthen the narrative of monetary policy easing. However, this path remains highly dependent on the realization of a recovery in shipping traffic and security dynamics around the strait.
Market participants will be monitoring indicators of Hormuz shipping flows, the response of energy prices to changes in volume, and further signals from US policy officials regarding the reopening timeline and its implications for Fed interest rate expectations.
Source: Newsmaker.id
