Federal Reserve Governor Stephen Miran made a blunt case Friday on CNBC that the central bank's monetary policy is still too tight and too focused on inflation, even as the labor market weakens.
After February payrolls fell by 92,000 and the unemployment rate edged up to 4.4%, Miran said the Fed should be leaning harder toward supporting jobs.
He told CNBC he would rather have rates much closer to neutral now, not sitting at today’s 3.5% to 3.75% target range.
That is not a small disagreement.
If Miran had his way, the fed funds rate would be about a full percentage point lower.
“I think that we don’t have an inflation problem,” Miran said. “I think that the labor market can use more accommodation from monetary policy. I think being close to neutral is appropriate.”
There is at least some basis inside the Fed’s own projections for Miran’s argument.
At the December 9-10 meeting, policymakers’ median estimate for the longer-run federal funds rate — the rough stand-in for “neutral,” meaning policy that neither restrains nor stimulates growth — was 3.0%.
With the current target range at 3.5% to 3.75%, getting back to roughly neutral would imply about two more quarter-point cuts.
But Miran’s preferred path would go further than that, pushing policy below neutral and into territory that would actively support growth.
Could he be right? The strongest part of Miran’s case is that the labor market has clearly lost momentum. Friday’s jobs report was much weaker than expected, and it landed after a period in which Fed officials had already been acknowledging softer hiring.
Miran has also been arguing for months that inflation looks worse in the official data than it really is. In a December speech, he said some of what the Fed is reacting to is “phantom inflation,” especially in housing and in imputed service categories such as portfolio management fees.
His basic point is that these measures can overstate current price pressure because they do not always reflect what households are actually paying right now in a clean, forward-looking way.
Miran made a similar point about oil, arguing that the Fed should not overreact to a jump in gasoline prices.
“Typically, the Federal Reserve doesn’t respond to higher oil prices like that. It [boosts] headline inflation, but it tends to be a one-off shock,” he said. “When you think about core inflation [which does not include energy prices], it tends to be more predictive of where inflation is going over the medium term than headline inflation.”
Since December, Miran has voted at two FOMC meetings, and he dissented at both.
On Dec. 10, 2025, the committee cut rates by a quarter point to 3.5% to 3.75%, but Miran preferred a half-point cut.
On Jan. 28, 2026, the committee held rates steady, and Miran again dissented, this time joining Christopher Waller in favor of a quarter-point cut.
Nevertheless, Miran may not be fully right yet. Inflation is still above 2%, and many Fed officials remain wary of easing too fast.
But his core point is no longer easy to dismiss: if the labor market keeps weakening and much of the inflation still showing up in the data is either lagged or distorted, then the risk may be shifting from doing too little to doing too much.
Before Trump nominated Miran to the Fed Board, he served in the Trump administration as chairman of the Council of Economic Advisers. He took office at the Fed on Sept. 16, 2025, filling the unexpired term of Adriana Kugler.
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