MNI BRIEF: Fed Gov Miran Urges Quicker Pace Of Easing

Federal Reserve Governor Stephen Miran argued again Monday for lowering interest rates faster, citing underlying inflation pressures close to target and the risk of rapid job market deterioration. 

"The shelter outlook appears relatively clear -- because market rents lead measured inflation -- and powerful enough to overwhelm even the possibility of sustained higher goods inflation. Underlying inflation is near, and further approaching, our target," he told a Columbia University conference. 

"On the other side of our mandate, experience suggests that labor market deterioration can occur quickly and nonlinearly and be difficult to reverse. In part because monetary policy lags several quarters, a quicker pace of easing policy -- as I have advocated -- would appropriately move us closer to a neutral stance." 

Miran noted "market-based" core inflation is running below 2.6%, or below 2.3% if housing inflation is excluded, "within noise of our target." A market-based measure excludes imputed prices such as portfolio management costs. Shelter inflation is still catching up to measures of new-tenant rent inflation, which have come in lower, he said. Non-shelter services inflation remains elevated mainly because of the imputed costs, he said. 

Miran called the evidence that tariff policy coincides with the increase in core goods prices this year "conflicted," adding deregulation will help expand supply, and business executives have indicated price pressures for goods will begin to decline
within two quarters. (See: MNI: Fed Biased To Ease With Focus On Jobs - Ex-Officials)