Miran defends low-rate view as colleagues caution on further cuts

Core Viewpoint - New Federal Reserve Governor Stephen Miran believes the Fed is misjudging the tightness of its monetary policy, suggesting that aggressive rate cuts are necessary to protect the job market [1][4]. Group 1: Monetary Policy Assessment - Miran argues that the current benchmark interest rate of 4% to 4.25% is more restrictive than Fed officials realize, proposing a cut of perhaps two percentage points [3][4]. - He emphasizes that the Fed has not adequately accounted for the downward pressure on the neutral interest rate caused by recent immigration, tax, and regulatory changes [2][4]. Group 2: Diverging Opinions Among Fed Officials - St. Louis Fed President Alberto Musalem supports a cautious approach, indicating that the policy rate may already be close to neutral and expressing limited room for further easing [5][6]. - Musalem warns that overemphasizing the labor market could lead to negative consequences, advocating for a balanced approach to monetary policy [6].