New Fed Governor Stephen Miran Calls for Larger Rate Cut
Stephen Miran, recently confirmed as a Federal Reserve Governor and chairman of the White House Council of Economic Advisers, dissented from the Federal Open Market Committee’s (FOMC) decision on Wednesday to reduce the federal funds rate by 25 basis points. Instead, Miran advocated for a more substantial half-point cut.
Miran, who was confirmed by the Senate earlier this week, was the only member of the FOMC to oppose the quarter-point reduction. Governors Michelle Bowman and Christopher Waller, who had previously dissented in favor of a smaller cut, aligned with Chair Jerome Powell and the majority of the committee during this meeting.
Contrasting Views on Monetary Policy
Chris Zaccarelli, Chief Investment Officer at Northlight Asset Management, noted the unusual dynamics: “It’s interesting that Waller and Bowman both stuck with consensus – despite auditioning for the Fed Chair position – and the newest member, Miran, has leapfrogged them with an even more dovish 50 bps dissent. It’s possible that they are trying to position themselves as more serious members of the Fed, who are interested in cutting rates 25 bps, but don’t feel the need for draconian cuts.”
Miran’s stance suggests a preference for more aggressive monetary easing than his colleagues, who generally anticipate only two further rate cuts in 2025. The FOMC’s dot plot reveals an unusually wide range of opinions among voting members regarding the number of rate cuts expected in 2026, with some forecasting up to four cuts.
Context of Miran’s Appointment and Fed Independence
Appointed by President Donald Trump in August to fill the seat vacated by former Governor Adriana Kugler, Miran’s term extends until January 31, 2026. Miran has indicated he will take an unpaid leave as chair of the White House Council of Economic Advisers rather than resign outright.
Critics have expressed concerns that Miran’s appointment, along with three other Trump nominations to the seven-member Fed Board, threatens the Federal Reserve’s independence. This tension is further underscored by recent developments, including Trump’s claim to have fired Governor Lisa Cook—a move blocked by a federal appeals court, which the White House now plans to appeal to the Supreme Court.
FinOracleAI — Market View
Stephen Miran’s dissent advocating a 50 basis point cut signals a more dovish faction emerging within the Fed, potentially indicating growing internal pressure for more aggressive monetary easing. This divergence could introduce uncertainty into markets, particularly if Miran’s views gain traction or influence future policy decisions. However, with the majority of the Fed maintaining a more cautious approach, the immediate market impact may be muted. Investors should monitor upcoming Fed communications and economic data for signs of shifting consensus.
Impact: neutral
