Stephen Miran urges Fed to cut rates by ‘more than 100 basis points’ this year
Federal Reserve Governor Stephen Miran discusses his expectations for Fed policy in 2026 and analyzes the state of the US economy on ‘Mornings with Maria.’
Federal Reserve Governor Stephen Miran said the central bank should move forward on interest rates this year, saying a rate cut of more than 100 basis points is justified as inflationary pressures continue to ease.
In an interview with Maria Bartiromo on FOX Business’ “Mornings with Maria,” Miran said inflation is close to the Federal Reserve’s 2% target once short-term rate distortions are removed. He said the current policy remains clearly restrictive and could slow down economic growth, causing a decline in the levels expected by 2026.
“I think we should drop more than 100 points this year,” said Miran. “Once you adjust for the negatives like housing… once you adjust for the negatives like portfolio management services… once you adjust for those things, latent inflation goes with the sound of our intent.”
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Miran specifically pointed to the housing inflation data, which he described as “backward-looking” and not reflective of current market conditions, noting that market rents were growing at a low annual rate as official measures still show high housing costs tied to post-pandemic disruptions.
He also pointed to the distortion of data from portfolio management services, saying these figures continue to add to core inflation readings as funds charged to investors have fallen, which he said exaggerates inflationary pressures and supports the rapid pace of deflation.
Federal Reserve Board Chairman Jerome Powell holds a news conference following the Federal Open Market Committee meeting on June 18, 2025, in Washington, DC. (Win McNamee/Getty Images)
The Federal Reserve has cut interest rates three times in the past year, bringing the benchmark federal funds rate to a range closer to 3.50% to 3.75%. Markets are now widely expecting policymakers to hold rates steady at their next meeting later this month.
However, Miran said more expansion will eventually be needed, pointing to a slowly cooling labor market and a high unemployment rate.
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Beyond inflation, Miran pointed to a slowly cooling labor market, with the unemployment rate rising. He said that keeping the policy tight puts growth at risk even as economic conditions improve.
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“I think the policy is clearly restrictive,” Miran said, “and it’s holding back the economy and underlying inflation… I think…
Miran said the persistence of lagging inflation risks making the policy unnecessarily restrictive. As underlying rate pressures fade and the labor market cools, he argued that the Fed should move quickly to cut rates to avoid slower-than-needed growth.
President Donald Trump nominated Miran, currently the chairman of the White House Council of Economic Advisers, to the Federal Reserve Board of Governors in 2025 to fill out the remainder of the term that ends on January 31, 2026, after former Governor Adriana Kugler resigned.
Miran told Bartiromo on Tuesday that he had never spoken to Trump about serving as the next Fed chairman.
“It’s not something I’ve prioritized,” he said.
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