Outgoing FOMC member says central bank should lower rates by 'well over 100 basis points'
Federal Reserve governor Stephen Miran used one of his final public appearances at the United States central bank to renew his push for aggressive easing, arguing that policy has been “clearly restrictive and holding the economy back” and that “well over 100 basis points of cuts are going to be justified this year,” in an interview with Fox Business.
Miran, whose term as governor ends on January 31, said underlying inflation is “basically at the Fed’s 2% target” and that he expects the economy to grow robustly this year – provided the central bank lowers short‑term borrowing costs. Failure to act, he warned, could upend that outlook.
From political uncertainty and tariff debates to rising credit costs and AI disruption, Jonathan Hornik of NPLA outlines the key forces that will define mortgage lending in 2026. https://t.co/Imft4PiejH
— Mortgage Professional America Magazine (@MPAMagazineUS) January 5, 2026
He also reiterated that it is “very difficult to argue that policy is about neutral,” contending that the current 3.50%–3.75% federal funds range sits in restrictive territory relative to Fed estimates of a neutral rate around 3%.
Market pricing and Fed signals diverge from Miran’s preferred path. Fed officials as a group have penciled in just one cut for the year, even after lowering rates three times last year to counter a weakening job market.
Minneapolis Federal Reserve president Neel Kashkari said he believed policy is now close to a level that neither spurred nor restrained growth as officials weighed stubborn inflation against a cooling labour market.
“My guess is we’re pretty close to neutral right now,” Kashkari said in a live CNBC “Squawk Box” interview.
“We just need to get more data to see which is the bigger force. Is it inflation or is it the labor market? And then we can move from a neutral stance, whatever direction is necessary.”
Philadelphia Fed president Anna Paulson said “some modest further adjustments to the policy rate would likely be appropriate later in the year” if her outlook held.
Other policymakers struck a more cautious tone. Governor Chris Waller said there was “no need to rush to make more cuts,” even as he acknowledged labor‑market softness and said he did not expect inflation to reaccelerate.
Richmond Fed president Tom Barkin called the balance between cooling inflation and preserving jobs “a delicate balance.”
Beyond traditional markets, prediction platforms suggest traders are still pricing in only about 50 basis points of easing this year
Whatever the final cut tally, Miran’s intervention underscores how quickly the policy narrative could shift and how critical it remains to focus on market expectations, not just Fed headlines, when gauging where mortgage pricing might head next.
Stay updated with the freshest mortgage news. Get exclusive interviews, breaking news, and industry events in your inbox, and always be the first to know by subscribing to our FREE daily newsletter.
