Fed Should Cut Rates by 2%, Says Trump-Appointed Official
Fed Governor Stephen Miran urges nearly 2% rate cut, citing economic pressures and monetary policy concerns.
- Fed’s Stephen Miran calls for nearly 2% rate cut
- Says current rates may be too restrictive
- Markets react to potential shift in Fed policy
Fed Policy May Be Too Tight, Says Miran
Stephen Miran, a Federal Reserve Governor appointed during the Trump administration, made headlines this week by calling for a significant rate cut. In his statement, Miran argued that the U.S. central bank’s benchmark interest rate should be lowered by nearly two full percentage points. This bold recommendation signals growing concerns over the current state of monetary policy and its impact on the broader economy.
The Fed’s current interest rate sits at its highest level in over two decades, part of an aggressive campaign to fight inflation. However, Miran believes this tight stance is now overly restrictive and could be stifling economic growth and job creation.
Miran’s Comments Spark Market Reactions
Miran’s call for a substantial rate cut quickly drew attention from economists, analysts, and investors. Financial markets responded with increased speculation that the Federal Reserve may pivot sooner than previously expected.
A nearly 2% cut would mark a dramatic shift in the Fed’s policy approach. Such a move could lower borrowing costs across the economy, ease pressure on businesses and consumers, and potentially boost stock markets.
Still, many observers remain cautious. Inflation, while lower than its 2022 peak, continues to hover above the Fed’s 2% target. Cutting rates too quickly could risk reigniting inflationary pressures — a concern voiced by other Fed officials.
What’s Next for the Fed?
Miran’s suggestion does not mean a policy change is imminent. The Fed’s decisions are made collectively by its Board of Governors and regional bank presidents. Still, his remarks reflect growing internal debate about how long interest rates should remain at their current levels.
The next Federal Reserve meeting could shed more light on this discussion. For now, Miran’s comments have added momentum to the idea that the central bank may be approaching a turning point in its fight against inflation.
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