Miran joins Fed as bank prepares to cut rates

President Trump’s top White House economist officially joined the Federal Reserve board of governors Tuesday as the central bank kicked off a critical meeting on interest rates.

Stephen Miran was sworn in as a member of the Fed board, the central bank announced Tuesday, barely 12 hours after the Senate voted to approve his nomination along party lines. 

Miran will take an unpaid leave of absence from the White House, where he serves as chairman of the Council of Economic Advisers (CEA), while he serves out the remaining four months of the Fed board term he took up Tuesday.

The Fed board includes seven members, or “governors,” serving staggered 14-year terms. If a Fed governor leaves before the end of their term, their eventual replacement can serve the remaining time left on the term before it expires.

Miran joined the Fed on the same day it began a highly anticipated meeting of the Federal Open Market Committee (FOMC) — the panel of Fed officials responsible for setting interest rates.

The FOMC includes all seven members of the Fed board, the president of the Federal Reserve of New York and a rotation of presidents of regional reserve banks.

The Fed is expected to announce an interest rate cut at the conclusion of its meeting Wednesday, its first reduction in borrowing costs since Trump’s election in November.

Trump has imposed unprecedented pressure on the Fed to slash interest rates by crisis-level margins and is eager to replace Fed Chair Jerome Powell with a more sympathetic chief.

The president has also hinted toward nominating Miran to a longer term on the Fed board, particularly if he is successful in firing Fed Governor Lisa Cook from her position.

Senate Democrats have blasted Trump for eroding the independence of the Fed, and have accused Miran of being too loyal to the president to serve at the central bank.

While Miran’s quick confirmation is a win for Trump, it is unlikely to effect the result of the FOMC meeting. In a closely watched August speech, Powell voiced concerns about the slowdown in U.S. hiring and said the bank could begin cutting interest rates as soon as September.

Since then, the U.S. has posted another month of slowing job growth and rising unemployment.

Source: The Hill