Outgoing Fed governor has consistently argued rates should be much lower
Federal Reserve governor Stephen Miran’s call for 150 basis points of interest rate cuts in 2026 puts fresh pressure on policymakers already split over how quickly to ease and sharpens the focus of mortgage lenders and originators on the path of funding costs.
Miran argued that policy has remained too tight and that inflation dynamics give the Fed room to move faster than current market pricing.
“I’m looking for about a point and a half of cuts. A lot of that is driven by my view of inflation,” he said in a Bloomberg Television interview, adding that “underlying inflation is running within noise of our target, and that’s a good indication of where overall inflation is going to be going in the medium term.”
He framed the debate in labor‑market terms. “There’s about a million Americans who don’t have jobs, who could have jobs without causing unwanted inflation,” Miran said.
Miran, whose term on the Board of Governors ends January 31, has already urged “well over 100 basis points of cuts” in a Fox Business interview earlier this week, arguing that policy is “clearly restrictive and holding the economy back.”
Federal Reserve governor Stephen Miran urged over 100 basis points of rate cuts in 2026, arguing policy remains restrictive, while Neel Kashkari of the Minneapolis Fed and Anna Paulson of the Philadelphia Fed signaled a more cautious approach.https://t.co/ibq3k1Mosc
— Mortgage Professional America Magazine (@MPAMagazineUS) January 6, 2026
Other Fed officials have signaled a slower trajectory. The median projection from policymakers at the December meeting points to only one quarter‑point reduction in 2026, and several have warned against moving too quickly while inflation data remained noisy.
For mortgage professionals, the question is not Miran’s term, but whether his outlook captures a broader shift. US mortgage rates have already eased to about 6.25%, the lowest level since late 2024, offering a tentative boost to a housing market that has been pinned down by affordability constraints.
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.
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