White House Projects 3-4% Growth Recovery in Q1 Next Year... Emphasizes Price and Living Cost Stability

Kevin Hassett, NEC Chairman, speaks in CNBC interview
"Growth rate to drop by 1 to 1.5 percentage points due to shutdown"
$2,000 tariff dividend is a "good idea"

The administration of U.S. President Donald Trump has projected that the U.S. economy will recover a growth rate of 3 to 4 percent in the first quarter of next year. The administration also emphasized its focus on easing inflation and reducing the burden of living costs.

Kevin Hassett, Chairman of the White House National Economic Council (NEC). Photo by AFP Yonhap News

Kevin Hassett, Chairman of the White House National Economic Council (NEC), mentioned in an interview with CNBC on the 11th (local time) that there has been a slowdown in growth due to the recent federal government shutdown. He stated, "The question is when the recovery will happen-some of the loss will be permanent, but not all of it," and added, "I expect the growth rate to return to 3 to 4 percent in the first quarter of next year."

He explained that due to the effects of the shutdown that began on the first of last month, the growth rate, which had reached 4 percent over the past year, is expected to decline by 1 to 1.5 percentage points.

Economists point to shrinking consumption and global trade, slowing employment growth, rising unemployment rates, and persistently high inflation as the main burdens on the U.S. economy. However, some analyses suggest that increased corporate investment is offsetting these negative impacts.

According to a survey of economists released in mid-October by the National Association for Business Economics (NABE), more than 60 percent of the 40 respondents expected President Donald Trump’s broad tariff policies to lower the growth rate by 0.5 percentage points. None of the respondents believed that tariffs would boost economic growth.

Chairman Hassett emphasized that the Trump administration is focusing on "affordability"-reducing the burden of living costs-and enhancing consumer purchasing power. He claimed that under the previous Joe Biden administration, Americans’ purchasing power decreased by $3,400, but since the Trump administration took office in January this year, it has increased by $1,200.

Regarding the recent overall trend in prices, he assessed it as "really good," explaining that some fluctuations are temporary and due to seasonal factors. He also predicted that reducing the fiscal deficit would ease macroeconomic pressures on prices.

However, the U.S. Consumer Price Index (CPI) for September rose by 3 percent compared to the same period last year, still significantly exceeding the Federal Reserve’s target of 2 percent.

After Zohran Mamdani, who was recently elected in the New York City mayoral race, highlighted the soaring cost of living and drew support from young people and low-income groups, the issue of living costs has emerged as a central topic in politics. In response, the Trump administration has also been emphasizing the need to reduce the burden of living costs on a daily basis.

Chairman Hassett called President Trump’s proposals to provide a $2,000 per capita tariff dividend and introduce 50-year mortgage loans "really good ideas." He specifically explained that, with an increase in tariff revenues of about $200 billion this year, there is now fiscal room to pay out the dividend.