Jerome Powell’s first meeting with Stephen Miran produced an unexpectedly broad majority to lower rates by a quarter point, a sign of the Fed chairman’s ability to build a consensus.
Before Wednesday’s meeting of the Federal Open Market Committee, some on Wall Street saw deeper division, with Miran representing a potential third dissenting vote for a half-point cut.
But instead, governors Christopher Waller and Michelle Bowman went with their fellow policymakers, after dissenting at the prior meeting, leaving Miran as the outlier in the 11-1 vote.
In a Bloomberg column on Thursday, former New York Fed President Bill Dudley said “Powell is firmly in control” of the FOMC. He added that central bankers who were inclined to keep rates steady deferred to the Fed chair and agreed to cut.
Meanwhile, Bowman and Waller, who both were appointed by Trump, refused to follow the president’s lead for much steeper rate cuts.
“Their actions demonstrate integrity, commitment to the Fed’s mission and the importance of sustaining the central bank’s independence,” Dudley wrote.
Others on Wall Street also highlighted the vote margin, especially given Trump’s attempt to fire Fed Governor Lisa Cook and his appointment of Miran, who hasn’t stepped down from his role as a White House economic adviser.
Jeffrey Roach, chief economist for LPL Financial, said in a note Wednesday that the 11-1 decision provided a greater sense of unanimity than what was expected.
And Susan Hill, senior portfolio manager and head of government liquidity group at Federated Hermes, said in a note that while she expects continued pressure from the White House, “at least for now most seem to have stood behind Powell, and I’m sure that played at least a part in how comfortable and confident he seemed during the press conference.”
Powell, whose term as chair expires in May, also seemed to push back significantly against Miran and the White House during his post-meeting remarks.
When asked how seriously a half-point cut was considered, Powell said “there wasn’t widespread support at all” for it.
He also expressed no regrets on the timing of the cut—the first since December—despite Trump’s relentless pressure and complaints about him being too late.
“I think we were right to wait and see how tariffs and inflation and the labor market evolved,” Powell said.
The Fed chief similarly downplayed Miran’s recent mention of the third mandate for the central bank to target moderate long-term rates.
Officials have previously maintained that the two other mandates for price stability and maximum employment will result in moderate long-term rates as a byproduct.
“We haven’t thought about that for a very long time as a third mandate that requires independent action,” Powell said Wednesday. “So that’s where that is. And there’s no thought, as far as I’m concerned, there’s no thought of considering that we somehow incorporate that in as something in a different way.”
For his part, Miran told CNBC on Friday that he was merely pointing out what’s in the law when it comes to the three Fed mandates.
He also acknowledged being an outlier at his first meeting but that he would have more time to make his case at subsequent meetings.
Before joining the administration, Miran had previously called for changes at the Fed that would erode its independence and said its consensus-driven approach should give way to more robust debates.
But when asked about his first FOMC meeting—including his dynamic with Cook, who is fighting Trump’s attempt to fire her—Miran described a warm reception.
“Everybody was extremely welcoming and extremely kind and extremely cordial. And it was a very collegial environment, and I really appreciated that—and that includes Governor Cook,” he told CNBC. “Everyone has been very nice to me, and I’m very appreciative of that.”