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Miran

Trump Fed Nominee Stephen Miran Faces Senate Hearing: Independence of Central Bank in Question

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President Donald Trump’s effort to reshape the Federal Reserve takes center stage this Thursday as the Senate Banking Committee prepares to hear the nomination of Stephen Miran, one of the president’s top economic advisers, for a vacant seat on the Fed’s Board of Governors. The outcome could significantly influence the direction of the U.S. economy and raise questions about the future independence of the world’s most powerful central bank.

STORY HIGHLIGHTS

  • Trump Fed nominee Stephen Miran faces Senate Banking Committee hearing Thursday.

  • Miran previously challenged Fed independence in research and co-authored reports advocating increased presidential influence.

  • Fed expected to cut interest rates mid-September, adding urgency to leadership questions.

  • Lisa Cook, recently fired Fed governor, challenges Trump’s removal in federal court.

  • Confirmation of Miran could pave the way for potential Fed chairmanship.

Less than a mile from Capitol Hill, the fate of another Fed official hangs in the balance. Lisa Cook, recently fired by Trump over alleged mortgage fraud, is challenging her removal in court. A federal judge is reviewing new filings and could issue a ruling as early as Thursday on whether Cook can remain a Fed governor while her lawsuit proceeds.

Since the start of 2025, the Trump administration has repeatedly criticized the Federal Reserve for not cutting interest rates on command. Central bankers have held firm, opting to monitor the economy’s response to Trump’s sweeping policies. Still, the Fed is reportedly preparing for a rate cut in mid-September, reflecting the ongoing tension between policymakers and the White House.

Miran’s Position and Views

Stephen Miran has repeatedly emphasized his commitment to preserving Fed independence. In his prepared testimony for the Senate hearing, he stated:

“The Fed’s rate-setting committee is an independent group with a monumental task, and I intend to preserve that independence and serve the American people to the best of my ability.”

He reiterated similar views in media interviews following his nomination, insisting that the central bank must operate free of political pressure.

However, Miran’s past work raises questions about the depth of that independence. Last year, he co-authored a report with the Manhattan Institute arguing that Fed independence is an outdated “shibboleth.” The report recommended shorter terms for Fed governors to increase presidential influence over the central bank.

“Central bank independence has long been considered an essential element for successful monetary policy,” the report said.
“But central banks are creations of political exigency, and pure independence exists only in textbooks. It can also bestow power without accountability.”

Miran is also known as a key architect of Trump’s aggressive trade policies. A November 2024 paper by Miran detailed how a tariff-focused approach, designed to weaken the dollar, could reshape the global trading system in favor of the United States.

Democrats Raise Concerns

Lawmakers, particularly Democrats, are expected to scrutinize Miran’s record. Senate Banking Committee ranking member Elizabeth Warren said in prepared remarks:

“Every claim he makes and every vote he takes will be tainted with the suspicion that he isn’t an honest broker, but that he is Donald Trump’s puppet.”

Some Republicans are also expected to challenge Miran’s views on the Fed’s independence. Senators will likely question whether his past advocacy for increased presidential influence over the Fed is compatible with the role of a governor tasked with making unbiased economic decisions.

Potential for Fed Chairmanship

Miran’s nomination could extend beyond a standard governor position. Trump has suggested that Miran might serve a longer term and potentially ascend to Fed chair. Trump said at a Cabinet meeting on August 26:

“We might switch him to the other, it’s a longer term, and pick somebody else. We’ll have a majority very shortly. So that’ll be great. Once we have a majority, housing is going to swing, and it’s going to be great.”

Fed rules allow the chair to be selected only from current governors. Fed Chair Jerome Powell’s term ends in May 2026, but he could remain on the board through 2028. This opens the possibility of Miran eventually taking the top Fed position, following a path similar to former chairs Janet Yellen and Ben Bernanke.

Lisa Cook’s Legal Challenge

While Miran’s confirmation is being considered, Lisa Cook’s lawsuit adds complexity to the Fed’s landscape. Cook claims her firing violated due process, whereas the Trump administration cites alleged mortgage fraud as justification. An upcoming court decision is likely to have major implications, particularly as the Fed plans a policy meeting on September 16-17, when a rate cut is widely expected.

Democrats have requested that Miran’s hearing be postponed until Cook’s case is resolved, highlighting the uncertainty surrounding the central bank’s leadership and the potential political influence over its policy decisions.

As the Senate Banking Committee prepares to weigh Stephen Miran’s nomination, the future of the Federal Reserve’s independence and the direction of U.S. economic policy remain uncertain. Miran’s confirmation could mark a significant shift in how the central bank operates, while Lisa Cook’s legal challenge underscores the high-stakes political and legal battles shaping the Fed. With interest rate decisions looming, all eyes are on Washington, where the outcome may reshape the balance between politics and monetary policy for years to come.

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Trump Turns Up the Heat as Fed Faces Crucial Interest Rate Test

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As the Federal Reserve prepares to announce its interest rate decision on July 30, all eyes turn to Chair Jerome Powell amid renewed pressure from President Trump to slash borrowing costs. With inflation ticking above the Fed’s target and economic growth slowing, the central bank faces a delicate test. While Trump demands cuts, citing moves by global counterparts, the Fed appears poised to hold steady. This high-stakes standoff—where politics meets policy—now grips markets, as investors await Powell’s verdict on the nation’s financial path.

STORY HIGHLIGHTS:

  • Fed to announce decision on interest rates Wednesday at 2 p.m. ET

  • Rates expected to remain in the 4.25%–4.5% range

  • Odds of rate cut this week: Only 4%

  • Inflation in June: 2.7% — above Fed’s 2% target

  • Next potential cut likely at the Sept. 16–17 meeting

  • Trump: “Interest rates have to come down”

  • Powell: “Fed decisions are based on data, not politics”

In the latest display of tension between the White House and the nation’s central bank, President Donald Trump met privately last week with Federal Reserve Chair Jerome Powell, reiterating what he described as a “very simple” request: “Interest rates have to come down.”

The request comes at a time when the Federal Reserve is widely expected to keep interest rates unchanged during its upcoming announcement on Wednesday, July 30 at 2 p.m. ET. A press conference with Powell will follow at 2:30 p.m., where he will address the state of the economy and respond to questions about the Fed’s monetary policy stance.

Despite repeated pressure from the president and top administration officials, economists believe the Fed is unlikely to budge just yet. FactSet data puts the probability of the Fed holding rates steady at a striking 96%, signaling that Powell and his team remain committed to a cautious approach amid mixed economic signals.

The central bank has kept its benchmark interest rate in the 4.25% to 4.5% range since December 2024. That decision, made before Trump’s second-term inauguration in January, was aimed at keeping inflation under control while providing enough support for continued economic growth.

However, Trump has publicly expressed frustration at what he views as unnecessary hesitation. He has criticized Powell for months over what he calls the Fed’s “overly cautious” handling of interest rates. The President has argued that a rate cut would stimulate the economy, strengthen investment, and help American businesses thrive.

In recent remarks, Trump pointed to more aggressive monetary actions abroad:

“Look at what the European Central Bank and the Bank of England are doing — they’re cutting rates. We’re just sitting on our hands.”

Yet, Powell and other policymakers appear unfazed by the political messaging. They continue to assert that interest rate decisions are determined not by politics, but by economic fundamentals.

“Our decisions are guided solely by data and our dual mandate: maximum employment and stable prices,” Powell has stated repeatedly in past briefings, emphasizing the independence of the Federal Reserve.

Adding to the strain, senior Trump administration officials have floated criticism of Powell’s handling of a Federal Reserve building renovation, suggesting it could be used as justification for his removal. However, any such move would likely spark legal and political challenges, as the Fed chair has fixed-term protection under federal law.

Meanwhile, inflation is proving to be more persistent than expected. The Consumer Price Index rose to 2.7% in June, surpassing the Fed’s 2% target and underscoring concerns that recent tariffs introduced by the Trump administration may be contributing to rising consumer prices. This puts the Fed in a tough spot: cut rates and risk stoking inflation, or stay the course and risk slowing economic momentum.

According to Ryan Sweet, chief U.S. economist at Oxford Economics:

“With the labor market holding up and the impact of tariffs on inflation starting to rear its ugly head, the Federal Reserve has plenty of ammunition to justify keeping interest rates unchanged at the July meeting.”

Some internal debate does exist within the Federal Open Market Committee (FOMC), the 12-member body responsible for setting interest rates. At least two members — Christopher Waller and Michelle Bowman — have recently signaled that a rate cut may be warranted soon.

If both dissent, it would mark the highest number of dissenting votes in a Fed rate decision since 1993. Still, the majority view remains in favor of patience. As Sweet noted:

“Dissents are normal and even healthy. They show the Fed isn’t falling into groupthink.”

The broader economic picture supports that caution. Job growth in June exceeded expectations, and second-quarter GDP, though slowing, is still projected to expand by 1.8%, compared to 2.8% in 2024. While not stellar, the figures don’t yet paint a picture of crisis.

“Policymakers remain cautious, navigating persistent inflationary risks tied to trade policy along with cooling labor market conditions and growing political pressure from the administration to accelerate rate cuts,” said Gregory Daco, Chief Economist at EY-Parthenon.

The Fed’s primary tools—interest rate hikes and cuts—are designed to adjust the speed of economic activity. Raising rates tends to slow spending and investment by making borrowing more expensive, helping contain inflation. Conversely, lowering rates can stimulate the economy but may also fuel price increases if not timed correctly.

Looking ahead, economists believe the Fed is far more likely to deliver a cut during its September 16–17 meeting, as that would give more time to assess inflationary trends and job market shifts. FactSet estimates a 63% probability of a rate cut in September, likely by 0.25 percentage points, bringing the target range to 4% to 4.25%.

“With no imminent need to act, the Fed will likely wait until September to deliver the next 25 basis point rate cut,” Daco said, adding that further cuts could follow in 2026 if economic conditions deteriorate further.

As Powell prepares to face reporters on Wednesday, many will be watching not just for his view on inflation and growth, but also his response to escalating pressure from the Trump administration. While Powell’s current term extends through May 2026, speculation has grown that the White House may move to name a successor early to shape the Fed’s direction in the final years of Trump’s presidency.

Even so, Powell has shown little sign of yielding.

“The odds are that [Powell] sticks with his mantra that it doesn’t impact monetary policy and he isn’t resigning, while dodging questions about a shadow Fed chair,” Sweet observed.

As the Fed walks a tightrope between economic data and political interference, Wednesday’s decision—and Powell’s words—will offer a crucial signal on how the central bank plans to navigate an increasingly complex landscape.

As anticipation builds ahead of the Federal Reserve’s July 30 announcement, the path forward remains delicately balanced between economic signals and political pressure. While the White House intensifies its call for immediate rate cuts, the Fed holds firm to its data-driven mandate, navigating inflation concerns and global uncertainties with caution. Chair Jerome Powell’s steady approach reflects an institution aiming to preserve credibility in turbulent times. Whether rates fall now or in the months ahead, the decision will shape the trajectory of the U.S. economy—and define the Fed’s independence in the process.

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