Federal Reserve Governor Stephen Miran speaks with CNBC during the Invest i America Forum on Oct. 15, 2025.
CNBC
Federal Reserve Governors Stephen Miran and Christopher Waller provided conflicting views on how quickly the central bank should lower interest rates in the face of a weakening labor market and heightened geopolitical tensions.
Miran said Thursday he plans to repeat his push for a half percentage point interest rate cut when the Fed meets later this month.
In a speech delivered in New York, Waller advocated a quarter percentage point reduction at the October meeting, a position that appears more in line with the Fed consensus.
Taken together and combined with recent statements from other monetary policymakers, the rate-setting Federal Open Market Committee looks to be on a clear path to more reductions, the extent to which remains unclear.
“Based on all of the data we have on the labor market, I believe that the FOMC should reduce the policy rate another 25 basis points at our meeting that concludes Oct. 29,” Waller told the Council on Foreign Relations. “But beyond that point, I will be looking for how the solid GDP data reconcile with the softening labor market.”
Fed officials have been operating in a quandary between indications of a standstill in hiring against nagging inflation pressures exacerbated by President Donald Trump’s tariffs. Waller has been among officials advocating an approach in which the Fed looks through the tariffs as one-off price increases that will not provide lasting inflationary pressures.
Waller pointed to two scenarios — one in which gross domestic product continues its upward climb and the labor market improves, in which case the Fed would need a more cautious approach on cutting, and the other in which the economic picture darkens and additional rate cuts on the order of up to 1.25 percentage points are necessary.
“What I would want to avoid is rekindling inflationary pressure by moving too quickly and squandering the significant progress we have made taming inflation,” he said. “The labor market has been sending some clear warnings lately, and we should be ready to act if those warnings are validated by what we learn in the coming weeks and months.”
‘It should be 50’
Both Waller and Miran were appointed by President Donald Trump. Waller is considered one of the final front-runners to succeed Chair Jerome Powell when his term expires in May 2026.
In separate remarks, Miran conceded he still expects his colleagues to vote for another quarter-point reduction even as he thinks current circumstances warrant a more aggressive approach.
“My view is that it should be 50” basis points, he said during a Fox Business interview. “However, I expect it to be an additional 25 and I think that we’re probably set up for three 25 basis point cuts this year, for a total of 75 basis points this year.”
One basis point equals 0.01%, so 50 would be the equivalent of half a percentage point. Miran pushed for a half-point cut at the September meeting but was outvoted 11-1 on the Federal Open Market Committee.
Earlier this week, Powell indicated that a softening labor market kept the door open to additional easing. Participants at the September meeting indicated the likelihood of two more moves coming this year, though Miran favored an approach that would lop a total 1.25 percentage points off the fed funds rate by the end of 2025.
A government shutdown that has blocked the issuance of most key data points has made the Fed’s job tougher.
“It would be really helpful to have the economic data in order to be able to make the decisions we need to make,” Miran said. “Certainly, we would want to be inspecting the economy for signs of moves lower in inflation, for signs of changes in the job market. But without those data, we still have to make a decision anyway, and so we’ll have to rely upon our forecasts for doing so.”
Miran said economic growth largely looks “OK for most of this year” though he is concerned about the recent acceleration in tensions between the U.S. and China, which he sees as boosting the case for big rate cuts.
The FOMC next meets Oct. 28-29, with markets pricing in a nearly 100% of a quarter-point reduction.
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