Bessent Tells the Fed Not to Hike “Too Much”
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Treasury Secretary Scott Bessent went on CNBC. On the morning of Friday, November 13, 2026, he warned that it would be a mistake for the Federal Reserve to “hike too much into an energy supply shock” that he says is now easing. He called the recent inflation data very noisy. He said the Fed should look ahead rather than react to past data.
Long bonds kept falling anyway. The iShares 20+ Year Treasury Bond ETF (NASDAQ:TLT) fell 0.43% to $79.38, ending a week in which it lost 3.1%. The SPDR S&P 500 ETF Trust (NYSEARCA:SPY) slipped 0.38% to $754.21.
That leaves TLT owners facing a split between Treasury and the Fed, as Bessent wants restraint but the officials who vote on rates spent the same Friday leaning toward another hike. The Fed raised its range by a quarter point effective September 17, 2026, to 3.75%[1] to 4.00%[2], and the range has not changed since.
What Bessent Said and What He Left Open
Bessent said gasoline is below $4 a gallon, oil is down $20, and diesel is down about 10% so far. He predicted that a mild inflation number would likely arrive next week, but he did not name the report.
He also cited 3.4% growth last quarter and the Atlanta Fed’s GDP tracker at 3.5% for the current quarter. The Fed sets rates on its own, so his remarks were an opinion and did not change policy.
Producer Prices Gave Both Sides Evidence
The October producer price index showed final-demand prices up 0.3%[3] for the month and 6.5% from a year earlier, not seasonally adjusted. That was the biggest 12-month gain since November 2022.
Energy prices fell 0.1%, and diesel dropped 7.9%, which supports Bessent’s view that the shock is easing. But overall producer prices still rose while energy fell, so the pressure is coming from somewhere else.
Fed Hawks Hold the Stronger Case
Bessent argues the Fed should look through the energy shock because it is fading. San Francisco Fed President Mary Daly said a hike is likely given recent inflation data. She pointed to services inflation outside housing, which does not depend on oil.
Bessent’s own growth numbers also give the Fed room to raise without causing a downturn. Reuters reported that markets are fully pricing a quarter-point raise at the December 8-9 and January 26-27 meetings.
Rising Long Yields Push TLT Lower
Yields on every maturity rose over the week. The 2-year, which tracks expected Fed moves, closed Friday at 4.88%, up from 4.51% on November 6. The 10-year reached 5.15%, up from 4.86%.
The 30-year closed at 5.47%, up from 5.26%. TLT holds bonds maturing in 20 years or more, so its price falls when those yields rise, and with the 30-year above 5%, new bonds pay more than the ones the fund already owns.
Higher long yields also weigh on stock valuations, but solid growth supports earnings. That helps explain why SPY still gained 2.59% for the week while TLT lost ground.
What Could Move TLT Next
The near-term risks for TLT likely lean toward further losses. Bessent’s case depends on a mild inflation number arriving next week. Fed officials, however, are focused on services inflation that cheaper fuel cannot bring down.
A soft report could pull long yields lower and lift TLT. A December hike combined with sticky services prices would push those yields higher, and long bonds lose the most when that happens.
Short-duration Treasury funds that hold bills and notes carry less interest-rate risk. Their prices move little when rates rise, and their yields adjust higher as the Fed raises rates.
This view will be tested by two dates. If the Fed lifts the range above 4.00%[2] at its December 8-9 meeting and the November producer price report on December 15 shows prices still rising, the case against TLT holds. If the Fed leaves the range at 3.75% to 4.00%, the outlook for TLT would likely improve.
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Omor Ibne Ehsan is a writer at 24/7 Wall St. He is a self-taught investor with a focus on growth, cyclical, and dividend equities that have strong fundamentals, value, and long-term potential. He also has an interest in high-risk, high-reward investments such as penny stocks.
