Bloomberg’s Mike McKee breaks down comments by newly appointed Federal Reserve governor Stephen Miran, who told Bloomberg’s Saleha Mohsin during an interview at the Economic Club of New York that President Trump had not asked him to take specific policy stances.
The Federal Reserve’s newest policymaker, appointed by President Donald Trump, laid out his argument for aggressively lowering interest rates on Monday, presenting a view that aligns with the president’s demands but which makes him an outlier at the central bank.
In his first policy speech since joining the Fed, Governor Stephen Miran argued that the neutral rate of interest — where the policy rate neither stimulates nor weighs on the economy — has been pushed lower this year by tariffs, immigration restrictions and tax policy.
That means interest rates should be much lower to prevent damaging the economy, he said.
“The upshot is that monetary policy is well into restrictive territory,” Miran said Monday in prepared remarks for an event at the Economic Club of New York. “Leaving short-term interest rates roughly 2 percentage points too tight risks unnecessary layoffs and higher unemployment.”
Miran participated in last week’s Federal Open Market Committee meeting, where policymakers lowered interest rates by a quarter percentage point for the first time since December, to a range of 4-4.25%. Miran dissented, preferring instead to lower rates by a half percentage point.
Until his appointment to the Fed, Miran served as chair of the White House Council of Economic Advisers. He didn’t resign from that post but is taking an unpaid leave of absence. His term as governor expires at the end of January, though it’s unclear how long he might stay.
——–
Watch Bloomberg Radio LIVE on YouTube
Weekdays 7am-6pm ET
WATCH HERE: http://bit.ly/3vTiACF
Follow us on X: https://twitter.com/BloombergRadio
Subscribe to our Podcasts:
Bloomberg Daybreak: http://bit.ly/3DWYoAN
Bloomberg Surveillance: http://bit.ly/3OPtReI
Bloomberg Intelligence: http://bit.ly/3YrBfOi
Balance of Power: http://bit.ly/3OO8eLC
Bloomberg Businessweek: http://bit.ly/3IPl60i
Listen on Apple CarPlay and Android Auto with the Bloomberg Business app:
Apple CarPlay: https://apple.co/486mghI
Android Auto: https://bit.ly/49benZy
Visit our YouTube channels:
Bloomberg Podcasts: https://www.youtube.com/bloombergpodcasts
Bloomberg Television: https://www.youtube.com/@markets
Bloomberg Originals: https://www.youtube.com/bloomberg
Quicktake: https://www.youtube.com/@BloombergQuicktake
