Since joining the Fed’s board, Stephen Miran has defended his push for more aggressive interest rate cuts in an interview with CNBC.
The Federal Reserve cuts interest rates, what does that mean for your money?
The Federal Reserve will cut interest rates for the first time since 2024. This is what it means to you.
New Federal Reserve Governor Stephen Milan defended the Fed’s call for more aggressive interest rate cuts at its latest meeting, downplaying the risks against tariff inflation and defending concerns that his actions were affected by President Donald Trump.
Milan’s hastily confirmed case and the Trump administration’s efforts to fire federal governor Lisa Cook raised concerns about central bank autonomy. Milan argues that he will operate independently of politics and make decisions based on his own data and interpretation of the economy.
Milan said the president called him on the morning of September 16th to celebrate his new role, but the two did not discuss future votes. Milan was the only governor to challenge the half-cent point cut rather than the quarter-cent point cut that was advanced by the Fed.
“He didn’t ask me to take certain actions, I didn’t commit to certain actions. I put the points based on my economic analysis. That’s what I’m continuing,” Milan told CNBC’s “Money Movers” in his first interview since joining the Fed on September 19th.
Milan says Trump didn’t affect his decision
Milan, who is taking leave from his White House advisory role, is called the argument that he is making the president’s bid “silly.”
He added that he did not resign from the White House Economic Advisors Council because his Fed term ends within five months. If asked to pass January, he said he would “quickly” resign from his advice role.
For months, Trump has been working to pressure the Fed to more aggressive interest rate cuts, filling the seven-member committee with his appointees. According to a September 17 memo from Ey-Parthenon chief economist Gregory Daco, the efforts added “higher political tensions” to the latest Fed Conference.
“This dynamic can shape market expectations, raise risk premieres, and constrain the flexibility of the Fed’s policy if its reliability is raised question,” Daco said. “History shows that when central banks operate under political influence, economic outcomes tend to be suboptimal.”
The Senate narrowly confirmed Milan’s position on the Fed’s board just before kickoff of the two-day meeting in September. He fills the empty seats left by former governor Adriana Kugler, who resigned in August.
Milan downplays the impact of tariffs on inflation
He said he was more aggressive at the first Fed meeting to cut prices and that he saw no evidence of “material inflation from tariffs.”
“I don’t think there’s much evidence of any of these things,” he told CNBC. “I’m seeing disinflation coming from border policies, and I’m seeing downward pressure coming from other troops, like deregulation.”
Fed Chairman Jerome Powell has previously said there are indications that tariffs are beginning to appear in consumer prices, but the “rational basic case” is that tariffs will spur a one-off price shift rather than a more sustained inflation effect.
“But there is also the possibility that the inflation effect will be more permanent, and that is a risk of being evaluated and managed,” Powell said at a press conference following the latest Fed meeting. “Our duty is to ensure that one-time price levels rise does not become an ongoing inflation problem.”
Milan confirmed he is the only Fed governor in 2025 as the project rate actively fell from 2.75% to 3%.
He said he plans to share details of his reasoning during his speech on September 22nd and hopes to persuade other governors to take a more aggressive rate approach.
“I was sworn about an hour before the meeting began,” Milan said. “The way the Fed works is by persuasion, so I will have my argument in the coming weeks and months.
