Fed's Miran Weighs In on Warsh, Rate Cuts and Balance Sheet

Summary

Federal Reserve Governor Stephen Miran joins Bloomberg The Close to discuss his final days as a governor, his dissent for a 25bp rate cut, and his view that rates remain restrictive enough to warrant further gradual cuts. He says labor-market slack persists beneath a stable unemployment rate and argues inflation overage is largely a measurement issue. Miran also praises Kevin Warsh as the next Fed chair, supports shrinking the balance sheet after regulatory reform, and says balance-sheet tightening can be offset by lower short-term rates.

• Fed Governor Stephen Miran explains his dissent for a 25bp cut and says rates are still too restrictive.
• He favors further cuts at a slower quarter-point-per-meeting pace.
• Miran sees hidden labor-market slack among younger workers and college graduates.
• He argues inflation overage mainly reflects portfolio-management and shelter measurement quirks.
• Miran praises Kevin Warsh as a credible, consensus-building Fed chair nominee.
• He supports shrinking the Fed's balance sheet after regulatory reform, with roll-off less likely to move long rates.
• Miran says short-rate cuts can offset any tightening from balance-sheet reduction.