President Donald Trump's new Fed director, Stephen Milan, has taken a decidedly dovish line in his latest assessment of monetary policy.
Milan said there was no need for aggressive rate cuts or to make up for steps not taken in the past.
“I don't think there's a need for a 75 basis point rate cut. Similarly, I don't think there's a need to make up for the insufficiency of the previous rate cuts,” Milan said.
Millan noted that there are differing opinions within the Fed on how much to cut rates, saying that while many of his colleagues want gradual cuts of 25 basis points, he wants to reach a neutral rate in 50 basis point increments.
Milan used cautious language, saying a December rate cut was very likely. Speaking on the Monetary Matters podcast, he said:
“Unless there is some surprise, I expect a rate cut in December. The distribution of votes on the table is actually different from the distribution of opinions. So based on current information, I expect a rate cut in December, but there is no 100% guarantee.”
*This is not investment advice.
