Fed Governor Miran says job losses in February add to the case for more interest rate cuts

Federal Reserve Governor Stephen Miran recently commented on the weak February jobs report, stating that it strengthens the case for the central bank to lower interest rates further. In an interview with CNBC, Miran emphasized the need for the Fed to prioritize supporting the labor market over concerns about inflation.

Miran expressed his belief that there is not an inflation problem and that the labor market could benefit from additional monetary policy accommodation. He argued that maintaining a moderately restrictive monetary policy stance, as opposed to a neutral one, is not appropriate. Miran suggested that the Fed’s key interest rate should be closer to a neutral level, which he believes is about a full percentage point lower than the current range of 3.5% to 3.75%.

The Federal Reserve had implemented three consecutive quarter percentage point cuts in the latter part of 2025, bringing the target interest rate to its current level. Miran disagreed with the consensus of Fed officials at the December meeting, who viewed a neutral rate to be around 3.1%, implying the need for two more rate cuts.

Miran also addressed the issue of stubbornly high inflation numbers, attributing them to measurement methods used by government agencies rather than actual economic pressures. He pointed out that factors such as rising portfolio management fees, driven by a booming stock market, can skew inflation figures.

Regarding the recent surge in oil prices due to geopolitical tensions, Miran downplayed its impact on inflation, noting that the Federal Reserve typically does not respond to such temporary shocks. He emphasized the importance of focusing on core inflation, which excludes volatile energy prices, as a more reliable indicator of future inflation trends.

Since his appointment as a Fed governor, Miran has consistently dissented at FOMC meetings, advocating for more aggressive rate cuts than those approved by the committee. Despite his dissenting views, Miran expressed hope that his colleagues would support further rate cuts in upcoming meetings.

As Miran’s term as a governor expired in January, discussions are underway for his successor. President Trump nominated Kevin Warsh for a position that could potentially replace current Fed Chair Jerome Powell. Miran indicated that he would continue serving until a successor is approved, emphasizing a day-by-day approach to his role.

In conclusion, Stephen Miran’s stance on monetary policy reflects a cautious approach to balancing economic factors such as inflation and labor market conditions. His calls for further rate cuts underscore the ongoing debate within the Federal Reserve regarding the appropriate policy response to current economic challenges.