Milan confirms appointment as The Federal Reserve Board of Governors and will attend the interest rate decision meeting on Tuesday.

Author: Li Xiaoyin, Wall Street Journal

Stephen Miran, economic advisor to Trump, has officially joined the Federal Reserve as a board member.

On Monday evening local time, the Senate confirmed the nomination of Milani, the Federal Reserve Board member selected by Trump, in a final voting session. This means he will be able to participate in the Federal Open Market Committee (FOMC) meeting starting on Tuesday and will have voting rights.

The market widely expects the Federal Reserve to cut interest rates by 25 basis points at this meeting. However, the addition of Milan may change the voting landscape, as he, along with some officials like Federal Reserve Governor Christopher Waller, is believed to potentially support a cut of 50 basis points or a larger reduction, in line with the White House's call.

This appointment comes at a time when the Trump administration continues to pressure the Federal Reserve, demanding significant easing of monetary policy. Meanwhile, the White House is also attempting to legally block another board member, Lisa Cook, from attending this week's meeting.

Milan will fill the vacancy left by Adriana Kugler's departure in August, with a term ending in January 2026.

Voting the Day After Confirmation? The Fastest in History

The schedule for this confirmation vote is exceptionally tight, creating the possibility for Milan to participate in the FOMC meeting, but it also brings procedural challenges.

Generally speaking, the entire process from Senate approval to the official swearing-in and taking a seat at the FOMC table usually takes several days. If Milan can complete all the procedures before the meeting starts on Tuesday, he will set a historical record.

According to an analysis by Barron's, there has never been a Federal Reserve governor who immediately attended a rate-setting meeting the day after being confirmed since the implementation of the Banking Act in 1935. The previous fastest record was set by H. Robert Heller in 1986, who was confirmed on a Saturday and attended the meeting that started the following Tuesday.

It is currently unclear whether Milan will be able to submit his economic forecast summary in time to be included in the materials released after the meeting.

Concerns about the Erosion of the Federal Reserve's Independence Intensify

Milan's joining comes at a time when President Trump is publicly pressuring the Federal Reserve.

Earlier on Monday, Trump posted on the social media platform Truth Social, using the nickname he gave to Federal Reserve Chairman Powell, stating, "'Too Late' must cut interest rates immediately, and the extent must be greater than he thinks."

Trump has continuously called for lowering interest rates to a low of 1%, a level that typically only occurs during economic crises, with the aim of stimulating growth and reducing government borrowing costs.

In terms of policy inclination, Milan is seen as a "hawkish" figure possibly shifting to "dovish" and pushing for more aggressive rate cuts. The mainstream market expectation is a 25 basis point rate cut, but if Milan and officials like Waller vote in favor of a 50 basis point cut, it could trigger a more intense debate within the FOMC and introduce uncertainty to the final policy decision.

As an ally of Trump, Milan's nomination has raised concerns about whether he can maintain the independence of the Federal Reserve. Senate Minority Leader Chuck Schumer explicitly expressed opposition on Monday, stating:

"Mr. Milan's nomination is bad news for every American suffering under Trump's disastrous economic agenda. He will only be Trump's mouthpiece at the Federal Reserve."

Earlier, Milan also stated at the confirmation hearing that he plans to take an unpaid leave of absence from his position as chairman of the White House Council of Economic Advisers during his tenure at the Federal Reserve, but will retain that position. This arrangement contradicts a research report he co-authored for the Manhattan Institute, which called for measures to prevent the "revolving door" phenomenon between the White House and the central bank.

The Struggle for Council Seats Unfolds Simultaneously

As the Federal Reserve formally enters Milan, a legal battle between the White House and another current board member, Cook, is also intensifying.

Trump fired Cook last month on allegations of mortgage fraud, but she denied the charges. Last week, a federal judge temporarily blocked Trump's firing order, paving the way for Cook to attend this week's FOMC meeting.

In response, lawyers from the U.S. Department of Justice have filed an emergency motion with the appeals court, requesting a stay of the lower court's ruling before Monday to prevent Cook from attending.

The multi-faceted struggle for council seats makes this week's FOMC meeting not only an economic decision regarding the direction of interest rates but also a political focus concerning the independence of the Federal Reserve and the future personnel structure.