Key Takeaways
- The Senate has voted to confirm Stephen Miran, a White House economic advisor, to a seat on the Federal Reserve’s board of governors.
- Critics of Miran’s appointment say it undermines the central bank’s independence from political influence.
- Trump has pressured the Fed to lower interest rates dramatically despite concerns that tariffs push inflation.
The Senate has voted to confirm President Donald Trump’s appointee to the Federal Reserve Board of Governors, clearing the way for him to vote at a key interest rate policy meeting later this week.
The Senate approved Stephen Miran in a 48-47 party vote, giving him a place at the Federal Open Market Committee’s two-day interest rate policy meeting this week. Miran currently serves as a member of President Donald Trump’s Council of Economic Advisors, and has said he would take a leave of absence from his White House role while serving at the central bank.
Trump’s appointment of Miran has drawn criticism. Opponents of his appointment say his close ties to the White House could erode the independence of the Federal Reserve from political influence. He would be the first person since the Fed’s structure was modernized in the 1930s to take a leadership role at the Fed while also holding a position in a presidential administration, according to reporting by The Wall Street Journal.
Miran is set to serve the remaining term of former Fed Governor Adriana Kugler, who stepped down earlier in the summer. Kugler’s term ends Jan. 31.
Miran’s appointment is the latest step in Trump’s efforts to influence the Fed, which plays a crucial role in the country’s financial system. Trump has also attempted to fire another Fed governor, Lisa Cook, which would allow Trump to appoint another person who would serve on the seven-member Board of Governors and the 12-person committee that votes on interest rates.
Trump has demanded that the Fed sharply lower interest rates, which would reduce borrowing costs on many kinds of loans. However, the Fed has held rates steady so far this year out of concern that Trump’s sweeping new tariffs could push up consumer prices, fueling inflation. The central bank is widely expected to lower interest rates this week, but not nearly to the extent that Trump has asked.
The Fed, established by Congress in 1913 and modernized in subsequent decades, was set up to be independent from direct control of the White House. Many economists say the Fed’s independence is crucial for its ability to carry out its mission of controlling inflation while keeping employment high; a mandate that could require making unpopular decisions that benefit the economy in the long run, such as hiking interest rates to quell inflation.