As tensions between the United States and China flare up once again, a clear warning comes from the Federal Reserve.

Stephen Miran, a Fed Governor, has openly called for an immediate interest rate cut to prevent a potential slowdown in the U.S. economy — and perhaps to keep the global markets from spiraling into chaos.

“The longer we wait, the greater the risk,” Miran said, according to Bloomberg.

The Fed Under Geopolitical Pressure

Miran, one of the more proactive voices in U.S. monetary policy, emphasized that growing trade frictions with China have introduced a new wave of uncertainty.

“Downside risks are higher now than they were a week ago,” he said, referencing the threat of tariffs and supply chain disruptions.

The situation intensified after Donald Trump announced a 100% tariff on Chinese imports, effective November 1. The move, intended to strengthen America’s negotiating position, shook financial markets and increased pressure on the Fed to act swiftly.

According to Miran, this is the moment for preemptive action. “We need to move to a more neutral stance before the economy begins to crack,” he added.

Odds of a Rate Cut Surge

All signs point to another rate cut at the Fed’s October FOMC meeting.

Data from CME FedWatch show a 96.7% probability of a 25-basis-point cut on October 29.

Miran doesn’t believe that will be the last.

He considers it realistic for the Fed to cut rates twice more before the end of the year to stabilize growth and maintain market confidence.

Several other Fed officials — including Chris Waller and Michelle Bowman — have also expressed support for further easing by year-end.

Powell Hints at the Next Move

Fed Chair Jerome Powell recently signaled that another rate cut could come this month.

“The outlook hasn’t changed much since September,” Powell noted, referring to the Fed’s first rate cut of the year, which was triggered by a weakening labor market and slowing business investment.

Analysts say the new geopolitical stress — especially the renewed U.S.-China trade conflict — could become the main driver behind a more aggressive easing cycle.

The Fed Between a Rock and a Hard Place

The Fed now finds itself in a delicate position.

On one side, the White House is playing hardball with Beijing, as Treasury Secretary Scott Bessent recently reminded, saying that the U.S. will not be “blackmailed by the market.”

On the other, that very stance adds pressure on the U.S. economy, which the Fed must protect.

In essence, Miran’s message is that political strength must be balanced with economic caution.

If Washington tightens the screws on China, the Fed must act to soften the blow for domestic markets.

Summary: The Fed Is Fighting a Fire Sparked by Politics

Stephen Miran has become a voice of pragmatism in a world where markets are caught between politics and reality.

His call for an immediate rate cut shows that the Fed now sees the main risk not in inflation, but in geopolitics.

If Trump’s tariffs take effect and the trade war fully reignites, the Fed will have no choice but to move fast — even if that means opening the door to a new era of cheap money.


#Fed , #interestrates , #TRUMP , #fomc , #FederalReserve

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