Bessent Touts Warsh Fed Independence and Dollar Strength After Successful US-China Trade and AI Talks

Treasury Secretary Scott Bessent appeared on CNBC's "Squawk Box" on Monday, covering a range of major economic and diplomatic developments. On the Federal Reserve, Bessent confirmed that both he and President Trump are confident in Chair Kevin Warsh, saying Trump reaffirmed at Warsh's swearing-in that the chair should act independently and "optimize the path for both inflation and economic growth," even as the 10-year Treasury yield reached 5 percent.

Bessent championed dollar dominance across global markets, citing the dollar's 89.2 percent share of foreign-exchange transactions and the prevalence of dollar-pegged stablecoins. He also defended Treasury bond buybacks as a liquidity-management tool, rejecting suggestions they were designed to suppress yields, and pointed to Saudi Arabia's exit from the China-backed mBridge digital currency platform as a sign of the dollar's enduring global standing.

On AI policy, Bessent said the Trump administration would not offer AI developers a liability shield, stating that "it is humans who are responsible, not the AI." He said the administration favors voluntary and national-security-focused safeguards over broad mandatory regulation.

Bessent and U.S. Trade Representative Jamieson Greer separately described their engagement with Chinese Vice Premier He Lifeng in New York on September 20 as "very successful," covering trade and artificial intelligence. The U.S. side proposed a new AI safety notification mechanism, including a formal US-China AI dialogue focused on national security, for Trump and Xi Jinping to consider at their summit scheduled for September 24 in Washington.