^{Stephen Miran, governor of the US Federal Reserve, at the Nomura Research Forum during the International Monetary Fund (IMF) and World Bank Fall meetings in Washington, DC, US, on Wednesday, Oct. 15, 2025. | Samuel Corum | Bloomberg | Getty Images}

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In a recent interview, Federal Reserve Governor Stephen Miran made a bold case for a steeper rate cut in December than most of his colleagues are currently signalling. While many officials anticipate trimming rates by just 25 basis points, Miran continues to advocate for a 50-basis-point reduction—though he concedes that at least a quarter-point cut would be justified in the current economic climate.

Why Miran Is Pushing Harder

Miran argues that waiting too long to ease monetary policy could unnecessarily harm the economy. “If you’re making policy for what the data are now, you are backward looking,” he said, emphasising that monetary decisions made today often take 12 to 18 months to fully impact the economy. With inflation gradually coming down and labour market strength showing signs of fatigue, Miran believes the Fed should act now.
Previously Miran dissented at the September and October meetings of the Federal Open Market Committee (FOMC), where the majority opted for quarter-point reductions. His consistent position: a half-point cut would better reflect the “interim softening” seen across key indicators.

Economic Data That Matter

Recent figures lend some weight to Miran’s view: monthly payroll gains have slid from around 150,000 per month in 2024 to nearer 50,000 in the first half of 2025. Some estimate the unemployment rate ticked up to 4.4% in October, reflecting slower hiring and weak labour-supply conditions. In parallel, inflation remains elevated—hovering near 2.9% in August—well above the Fed’s 2% target.
Policymakers are split: some emphasise the inflation risk and prefer a cautious approach; others, like Miran, fear policy is already too restrictive and risks undermining growth and employment.

Forecasts, Market Expectations & The December Decision

The Fed’s median projection from its September meeting anticipated three rate cuts by year-end, though only two have been delivered so far. The market is currently pricing in about a 63% chance of a quarter-point cut in December and only about a 37% chance that the Fed will stand pat.
Miran argues that given lagging indicators and structural shifts in the economy—such as reduced immigration and lower housing inflation—monetary policy should be more accommodative than it currently is.

The Implications of a Larger Cut

If the Fed follows Miran’s 50-basis-point recommendation, it would mark one of the sharpest single-meeting efforts at rate relief since the committee adopted a more gradual approach in recent years. A more aggressive cut could:

• Signal to markets and borrowers that the Fed is prioritising growth and employment over inflation risks.
• Provide relief for interest-rate sensitive sectors like housing, business investment and consumer credit.
• Potentially lift stock and bond markets, but risk reigniting inflation if growth rebounds sharply.

On the other hand, sticking to a 25-basis-point adjustment would preserve a more cautious stance, signalling that inflation concerns still weigh heavily on policymakers.

Final Thoughts

Stephen Miran’s call for a half-point rate cut reflects his broader view that the U.S. economy is entering a period of slowdown where waiting could prove costly. While he allows that “at minimum” a quarter-point cut should occur, his preferred path is clearly more aggressive. The upcoming December FOMC meeting will reveal whether the Fed aligns with his stance or opts for the more conservative route. In either case, the decision will send a strong signal about how ready the central bank is to pivot from fighting inflation to bolstering growth.