Fed Governor Miran Urges FOMC to Deliver One Last Cut in December

Federal Reserve Governor Stephen Miran is pressing for another -- and final -- interest rate cut in December. In a recent interview with Yahoo Finance, the FOMC member pressed his case that policy remains too restrictive and that one more cut would be a reasonable step to bring rates closer to neutral.

Mirran emphasized that while ADP data came in slightly better than expected, showing private‑sector payrolls rising by 42,000 in October after a prior decline, he still viewed it as only a “welcome surprise” rather than evidence of a fundamentally stronger labor market.

“You continue to see modest potential for overall job creation. You continue to see indications that labor demand may not be as strong as we’d like it to be from a cyclical perspective. All of that to me is an indication that rates could be a little bit lower than where they are now.” —  Stephen Miran, Federal Reserve Governor

While BLS data remains inaccessible during the shutdown, ADP's report represents one of the few real-time indicators for labor health. Today, it showed private‑sector payrolls added 42,000 jobs in October, a modest gain that Mirran welcomed, but caution was not enough to change the overall picture of a soft jobs sector. 

“I think policy is too restrictive and that we're too far above where neutral rates would be," he noted. "I think that continuing to run a policy that restrictive is also to run unnecessary risks."

Throughout the year, Mirran has been one of the strongest voices inside the FOMC pushing for a dovish policy shift. Now, after two-consecutive rate cuts in September and October, the Fed Governor continues to push for one final move in December.

CME's FedWatch tool is pricing in a 68% chance that the Fed will bring rates down from the current 3.75%–4.00% range to 3.50%–3.75% at its December meeting. Prediction platform Polymarket is a tad more optimistic, as traders are giving a 73% chance of another rate cut. 

The biggest impediment to another rate cut doesn't appear to be economic data, but rather the lack thereof. The U.S. Government shutdown is already stretching past five weeks, marking the longest in American history, and has created a data blackout that leaves the Fed without critical indicators to guide its next move.