WASHINGTON – A representative appointed by President Donald Trump to the Federal Reserve’s Board of Governors suggested on Monday that the central bank’s primary interest rate should be significantly lower than its current 4.1% rate, marking a sharp contrast with his fellow board members.
Stephen Miran, who also serves as a chief economic advisor to Trump, indicated in a speech at the Economic Club of New York that factors like reduced immigration, increased revenue from tariffs, and an aging demographic support a rate closer to 2.5%. Recently shared projections show this figure is almost a full percentage point beneath the views of any of the 18 other members on the Fed’s rate-setting committee, highlighting an unusually stark difference in policy perspectives.
Miran’s statements highlight his distinct approach to discussions on interest rate policy at the Fed. His nomination has sparked debate since he retains his leadership role on the White House’s Council of Economic Advisers while on unpaid leave, bringing up issues about the Fed’s customary independence from everyday political matters. His tenure on the Fed’s board concludes in January, and while Miran has hinted at returning to the White House, he could remain until a new appointment is made.
“It should be apparent that my stance on suitable monetary policy is at odds with other … members” of the committee, Miran expressed in written comments. “I see the policy as exceedingly restrictive,” which he believes is impeding economic growth and imposes “significant risks” on the Fed’s congressional goal of ensuring maximum employment.
Miran argued that a decrease in immigration should increase housing availability and lower rental costs, helping to relieve inflationary pressures. He also noted that tariff revenues — projected to exceed $300 billion annually by Congressional Budget Office forecasts — should help narrow the deficit. As a consequence, the Fed wouldn’t need to maintain its key interest rate at its current level to curb inflation.
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