WASHINGTON, Jan 5 (Reuters) - Stephen Miran, a Federal Reserve governor whose term ends at the end of January, said Thursday that he is looking for 150 basis points of interest-rate cuts this year to boost
the U.S. labor market.
Miran told Bloomberg Television's Surveillance program that Fed officials had room to further reduce rates given his view that underlying inflation was likely running at 2.3%.
“I’m looking for about a point and a half of cuts. A lot of that is driven by my view of inflation,” Miran said. “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.”
Miran's comments offered a more precise view of his target for rate cuts this year, after he told the Fox Business Channel on Tuesday that "well over 100 basis points of cuts are going to be justified this year."
His call for 150 basis points of cuts is in line with the lowest projection for the appropriate funds rate by the end of 2026 among the Fed's 19 policymakers released at the end of December's rate-setting meeting. That anonymized estimate saw the fed funds rate at 2.00%-to-2.25% versus the current level of 3.50%-to-3.75% and is also 50 basis points below the next lowest estimate.
Miran's term as a Fed governor ends on January 31. He is controversially serving at the Fed while on leave from his role as a top economic advisor to President Donald Trump, who has repeatedly pressed the central bank to deliver big rate cuts.
(Reporting by Andrea Shalal and Katharine Jackson; Editing by Chizu Nomiyama )
