Fed Governor Stephen Miran Talks Outlook for Inflation, Rates

Summary

Podcast Summary: Fed Governor Stephen Myron Talks Outlook for Inflation, Rates

Podcast: Bloomberg Talks
Date: November 21, 2025
Guest: Fed Governor Stephen Myron
Host(s): Bloomberg Interview Team

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Episode Overview

This episode features a wide-ranging conversation with Federal Reserve Governor Stephen Myron. The discussion centers on the outlook for U.S. inflation, interest rate policy, the labor market, methodology concerns with inflation measures, the timing of upcoming data releases, and policy communication challenges facing the Fed. Governor Myron stands out for advocating a dovish stance on monetary policy, challenging hawkish arguments within the FOMC, and dissecting the implications of data lags and statistical artifacts in official inflation measurements.

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Key Discussion Points & Insights

1. Current Labor Market Assessment

• Governor Myron views the latest labor data as dovish, indicating that restrictive Fed policy is beginning to weigh on employment.
  • Quote: “The labor market has been affected by restrictive Fed policy. And given the outlook for inflation, there’s not really much of a need to be as restrictive as we are.” (00:52)
• Points to an uptick in the unemployment rate and more permanent layoffs as evidence policy is “too restrictive.”

2. Debate Over Inflation Persistency

• Responds to Fed Governor Barr's concern that inflation is still closer to 3% than 2%:
  • Myron argues that the prevailing “excess” inflation is a product of statistical quirks, not ongoing supply-demand imbalances.
  • Example: Housing market rents have been near 1% for years, but measured shelter inflation is higher due to lagging methodology in official indexes.
  • Quote: “All of the inflation excess, almost all of the inflation excess, is a mirage. It’s not indicative of supply demand imbalances.” (01:28)
  • He warns against setting policy for key years ahead using indices distorted by past imbalances.
• Criticizes the policy risk of asking people to lose jobs due to these statistical artifacts.
  • Quote: “It’s a mistake to ask people to lose their jobs because of the statistical measurement process.” (01:58)

3. Forecast-Based vs. Data-Dependent Policy

• Myron stresses that monetary policy acts with significant lags and should aim to forecast the economy’s position far ahead (12–18 months), not react to recent data.
• Expresses concern with excessive “data dependence,” which risks backward-looking, suboptimal policy.
  • Quote: “We should be forecast dependent, not data dependent. Being excessively data dependent is to be too backward looking.” (04:43)
• On whether to move meeting dates to await more data: skeptical, citing potential disruption and reiterating forward-looking policymaking.

4. Upcoming Rate Decision and Dissent

• Confirms he would support a 25bps rate cut if his dissent for a larger cut would block any rate reduction:
  • Quote: “I would absolutely vote for a 25 basis point cut if my vote were the marginal vote… to do otherwise would be to cause real harm to the economy for purposes of vanity.” (05:06)

5. Growth Outlook and Stimulus Measures

• Stresses policy is “too restrictive” and may cause unnecessary recession risk.
• While policy should react to real changes in demand and supply, he is not at this stage forecasting stronger growth off anticipated, but unconfirmed, stimuli (e.g., tax refunds).
• Notes the supply-side supports (like regulatory relaxation) need not be hawkish triggers, since they can expand productive capacity without driving excess demand.

6. Inflation Bumps from Stimulus versus Measurement Artifacts

• Refuses to pre-judge the potential inflationary impact of possible future stimulus checks, as no concrete program is yet proposed.
• Key labor and inflation data continue to show policy is, if anything, too tight.

7. Data Lags and Government Shutdown Effects

• Notes the next crucial inflation (CPI) report will not be released until after the upcoming FOMC meeting, due to government shutdown–induced delays. (07:52–08:30)
• Explains that data collection and processing are logjammed by work stoppages and subsequent catch-up, creating a “bullwhip” effect analogous to supply chains.
• Quote: “When you have a government shutdown, all the government employees aren’t working and they come back to work and they’ve got a ton of work to do all at once… we have those bullwhips in government data right now.” (08:30)

8. Financial Stability and Asset Prices

• Pushes back on arguments that lower rates would unduly encourage risk-taking or asset bubbles:
  • Cites the complexity of mapping monetary stance to asset prices and warns against using unemployment as a lever to target market valuations.
  • Quote: “It’s a mistake… to ask people to experience job losses because you think the stock market is too high. I don’t know what the right level for the stock market is.” (09:25)

9. The K-Shaped Economy and Inequality

• Acknowledges the challenges of a “K-shaped” economy but reiterates the Fed’s dual mandate:
  • Quote: “Congress didn’t task us with addressing all social problems… They tasked us with tackling aggregate maximum employment and stable prices.” (11:32)
• Notes that high unemployment would disproportionately harm lower-income Americans more than any hypothetical impact from monetary easing.

10. Personal/Political Remarks

• Shares a light exchange on “politically correct” Fed appointments and downplays inside knowledge, maintaining a candid, direct persona. (12:22–12:45)

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Notable Quotes (with Timestamps)

• On excess inflation:
  “All of the inflation excess, almost all of the inflation excess, is a mirage. It’s not indicative of supply demand imbalances.”
  — Stephen Myron (01:28)

• On making people lose jobs over measurement quirks:
  “It is a mistake to ask people to lose their jobs because of the statistical measurement process.”
  — Stephen Myron (01:58)

• On policy lags:
  “Monetary policy works with lags. So you have to set policy based on the forecast… We should be forecast dependent, not data dependent.”
  — Stephen Myron (02:53–04:43)

• On willingness to compromise on rates:
  “I would absolutely vote for a 25 basis point cut if my vote were the marginal vote. There’s no question about that… to do otherwise would be to cause real harm to the economy for purposes of vanity.”
  — Stephen Myron (05:06)

• On asset prices and policy:
  “It’s a mistake… to ask people to experience job losses because you think the stock market is too high. I don’t know what the right level for the stock market is.”
  — Stephen Myron (09:25)

• On the Fed’s mandate and inequality:
  “Congress didn’t task us with addressing all social problems… They tasked us with tackling aggregate maximum employment and stable prices.”
  — Stephen Myron (11:32)

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Timestamps for Important Segments

• 00:46 – 01:14: Labor market’s response to Fed policy
• 01:14 – 02:34: Disagreement over inflation persistence and measurement artifacts
• 02:34 – 04:10: Policy lags, outlook, and the significance of upcoming data releases
• 04:57 – 05:24: Rate cut dissent question and policy compromise
• 05:43 – 07:14: Debating supply-side growth and potential stimulus impacts
• 07:52 – 09:05: Data release delays, explanations, and implications for policy decisions
• 09:05 – 10:58: Financial stability, risk-taking, and asset prices in monetary policy
• 10:58 – 12:07: Addressing the K-shaped economy and dual mandate priorities
• 12:22 – 12:45: Politically correct appointments—Myron’s personal/political remarks

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Memorable Moments

• Blunt critique of data-driven (backward-looking) policy:
  Myron repeatedly calls for a forecast-based approach: “Being excessively data dependent is to be too backward looking. And if you’re too backward looking, you necessarily are going to have the wrong policies.” (04:43)
• Candor on intra-committee disagreement:
  Openly willing to compromise on rate cuts and calling out “vanity” as a reason not to.
• Anecdote about government shutdown effects:
  Comparing the surge in delayed government data to a “bullwhip effect” in supply chains. (08:30)

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Overall Tone and Takeaways

Governor Myron maintains a straightforward, technocratic, and data-literate tone. He is strongly dovish, ready to critique methodology issues in inflation measurement, doubts the urgency for continued restrictive rates, and calls for the Fed to look ahead, not backward. The conversational tone is brisk, sometimes wry, and aims to clarify the rationale behind his dissent within the FOMC.

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For those seeking concise expert insight into high-level Federal Reserve policy discussions, this episode provides a window into both the internal debates and the logic guiding current U.S. monetary policy.

Transcript

[Fed Governor Stephen Myron]

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[Radio Host]

Audio Studios Podcasts Radio News so here's.

[Interviewer]

The latest this morning. The New York Fed President John Williams pushing back against hawkish commentary from the FOMC and wall pricing in better than 50% odds the Fed will cut rates in December. Fed Governor Stephen Marin was the loan descent for a 50 basis point rate cut at last month FOMC meeting. And Governor Myron joins us now for more. Governor Myron, good morning. Good morning once again. Thanks for being here.

[Fed Governor Stephen Myron]

Thanks for having me back.

[Interviewer]

We've got to start with the labor market. Your reflections on what we saw yesterday, does it lean one way or the other?

[Fed Governor Stephen Myron]

Yeah, I mean, I think the implications of yesterday were obviously dovish. And if anyone was on the fence, I would hope that this would move them in the direction of cutting. I mean, you saw the unemployment rate edged up a bit. You know, you saw some other indicators like an increase in permanent layoffs. You know, those are indications that the labor market has been affected by restrictive Fed policy. And given the outlook for inflation, there's not really much of a need to be as restrictive as we are.

[Interviewer]

And yet on the committee we have pushback almost immediately after that. Fed Governor Michael Barr had this to say. I'm concerned that we're seeing inflation still around 3%. Inflation's closer to 3 than it is to 2. What you make of that argument, how persuasive is it?

[Fed Governor Stephen Myron]

It's not persuasive to me and I'll tell you why. All of the inflation excess, almost all of the inflation excess, is a moral barrage. It's not indicative of supply demand imbalances. And so, for example, if you look at the housing market rate, market rents have been running at about 1% for a couple of years. Measured inflation in the index is actually much higher than that because it takes a really long time for the index to converge down to where market rents are. That's a statistical artifact, right? That's an artifact of the statistical measurement process. It's indicative of a supply demand imbalance that was there in 2020-2023. Monetary policy works with lags. It has to be set now for 2027. So when you look at the housing data, right, you see market rents running about 1% for a couple of years. There's no supply demand imbalance there. We should not be setting policy for 2027 based on a supply demand imbalance that existed in 2022 or 2023. That doesn't make any sense. There's other things too, like portfolio management services which confuse quantities for prices. This stuff is all well known. If you look at market based measures of inflation, they're much closer to two than they are to three. So I think that the excess, the overage is a mirage and it's a mistake to ask people to lose their jobs because of course of the statistical measurement process.

[Interviewer]

You've got to put out new forecasts on December 10th as well, which is going to be complicated by the fact we've had limited data more recently. How relevant do you think the Canada actually is? Because I'll offer you the perspective on Wall street at the moment. It goes something like this. The meeting's on the 10th, you don't get the data until the 16th. The Fed's kind of constrained by that. They can't do anything. What's your perspective on that?

[Fed Governor Stephen Myron]

Yeah, so as I said a moment ago, monetary policy works with lags. It would be much easier if it hit the economy immediately, but it doesn't, it works with lags. So you have to set policy based on the forecast. So the data matter insofar as they affect your FOREC forecast. It doesn't make sense to be setting policy for where the economy was three or six months ago. We, we should be setting policy based for where the economy is going to be 12 to 18 months from now. And so if we have data, it gives us the ability to update our forecast. But the lack of data doesn't mean that we don't have a forecast. We did have a forecast and all it gives us is opportunities to falsify our forecast. And there hasn't been anything in the data, in the news, in media stories, in private sector data, alternative data that's available to us that would make us think that the forecast is somehow nullified and there's been a big shock to it. So if anything, all the information we've gotten, the interim since, since, since September, FOMC has inclined to the dovish side. You know, we got weaker inflation than people expected and we got a higher unemployment rate than, than folks were expecting. So all of that information should push one in the dovish direction.

[Political Correspondent]

But there are still Fed officials that are looking for more data and they have said they're data dependent, they want that insurance that they're cutting right now and it's the right time. Potentially the unemployment rate might be moving up to 4.5% on December 16. Would you be in favor of just moving the meeting if it meant others felt more reassured to cut interest rates in December?

[Fed Governor Stephen Myron]

So, you know, I haven't really thought about that. And it's not a conversation that, it's not a conversation that I've been part of. I mean, I agree the meeting dates seem, the meeting dates seem kind of arbitrary, but at the same time there's a lot of, there's a lot of stuff that gets done as a result of those meeting dates. And you know, people have investments and contracts and other decisions that are tied to the, to the, to the timing of the meeting date. And I don't know to what extent moving those dates would be disruptive for all that. So it's something that I'm not, not sure about. But this ultimately comes down to the question of data dependence. Is what you do when you don't have a forecast or when you don't have any confidence in your forecast. Right. We should be forecast dependent, not data dependent. Being excessively data dependent is to be too backward looking. And if you're too backward looking, you necessarily are going to have the wrong policies.

[Political Correspondent]

Neil Daughter writes, and he says the only question that matters for you is will you descend for 50 if you believe it means not being able to push through a 25 basis point cut?

[Fed Governor Stephen Myron]

Yes. So absolutely not. I would absolutely vote for a 25 basis point cut if my vote were the marginal vote. There's, there's no, there's no question about that. I, you know, to do otherwise would be to cause real harm to, to the economy for, for purposes of vanity. And that's not who I am going.

[Radio Host]

Into next year talking about the forecast of what's going to happen. A lot of economists who come on the show expect a reacceleration on the backs of the tax refunds and some of the other stimulative measures that could come early next year. How do you, how do you factor that into your forecast for ongoing weakness in the labor market and the consumer?

[Fed Governor Stephen Myron]

Yeah, so I think that, you know, I have not been a, what I, what I would think of as excessively pessimistic on the economy. I do think policy is restrictive and I do think that it's too restrictive and we don't need to be. And the longer we remain restrictive, the greater the chances that we are the source of an economic downturn which we should not seek to be. I think that many of the, many of the factors that will be kicking in over the next 12 months that might be supportive of GDP growth are things that necessarily don't have hawkish implications for monetary policy because they affect the supply side. And when you think about things like relaxing regulations, and I think that that has been going on at actually an impressive, an impressive pace, these are things that push out the supply side of the economy and therefore don't necessarily create a demand in excess of supply. Right. Monetary policy should be tight. If demand is in excess, is too much in excess of supply, and if you push out the supply side of the economy, then that's not something you worry about.

[Radio Host]

There's a duration mismatch here, though. The idea that if you reduce regulations and you allow people to build supply, that it takes longer time than, say, if you give people $2,000 checks right up front that they can spend immediately or if they get a rebate that's a lot bigger from their tax, from the tax filings. How do you factor in that timing mismatch? Would you look through any bump up in infl inflation next year from both stimulative measures as well as the price increases that we're excited. We're hearing from a lot of retailers that they're going to pass along.

[Fed Governor Stephen Myron]

So, you know, I wouldn't look through, I wouldn't look through bumps from, from, from checks like that. Right. You know, I don't think that, I don't think that you'd be able to. However, a policy like that has been, hasn't been formalized, it hasn't been introduced. We don't know the parameters of it. It's too early to sort of think about basing a forecast on, on something like that. What we do know is that the, is that the labor market data have been coming in not as strong as we'd like them to be in. That policy is too restrictive.

[Interviewer]

Governor, if we can stay on inflation, do you know when we're going to get some inflation data? When are we going to get that? Because we've heard about the payroll schedule. I haven't really heard anything about the CPI schedule. You've got any indication whatsoever of when it's coming?

[Fed Governor Stephen Myron]

Yeah, the BLS put it out on its website this week. I think that we're not going to get the November CPI data until after the next FOMC meeting.

[Interviewer]

So we've got to wait for that, too.

[Fed Governor Stephen Myron]

We've got it. We've got to wait for that.

[Interviewer]

You see that, Lisa?

[Radio Host]

Yes, I did. I saw that. We have to wait and it's not clear exactly when we're going to get it, but there's a real question going forward about when we might.

[Interviewer]

We don't have the dates yet, but we don't have.

[Fed Governor Stephen Myron]

The dates are. The dates are on the website. Yeah, the BLS has a, has a, has a list of the release dates.

[Interviewer]

The payrolls one, but I've missed the CPI one, which doesn't that just make it an even stronger case just to wait and have this meeting when we've got all this data? Why is it that we have to wait so much longer for it, Governor?

[Fed Governor Stephen Myron]

Wait for the data?

[Interviewer]

Yes.

[Fed Governor Stephen Myron]

Well, because the government shutdown introduced a whole number of snags into the data collection process. And so that those snags mean extra time to collect the data, extra time to process the data. People have a logjam of work to get back to. I mean we just, you know, sort of spent several years talking about, talking about bullwhips from supply chains. Right. And you know, gets pulled in at once. And when you have a government shutdown, all the government employees aren't working and they come back to work and they've got a ton of work to do all at once. And so you know, we have those bullwhips and in, in government data right now. And you know, if that were a market, you'd see some inflation in the price of data. But it's not a market.

[Interviewer]

So give me for coming out with the hawkish hits, but we got another one in the last 24 hours too, and it came from Beth Hammock. Lowering interest rates support the labor market risk, prolonging this period of elevated inflation. And it could also encourage risk taking in financial markets. Can we finish on that last point? Risk taking in financial markets, how excessive is it and should it be on the radar of the fomc?

[Fed Governor Stephen Myron]

Sure. So first of all, as I said before, the excess of inflation is a quirk of the statistical process. And it is a mistake to ask people to lose their jobs as a result of a quirk of a statistical process on financial markets. You know, look, I think that lots of things affect financial markets. Tax policy does, regulation does, technology like artificial intelligence does. It's a mistake to conflate the stance of the status of financial markets with the status of monetary policy. Right. Even when you look at something as a financial market as, as deeply connected to 2 to monetary policy, like interest rates, we've lived through periods of conundrums, right. Where passing through of the fed funds rate into longer term interest rates was confusing to people. So it's just a mistake to do a one for one mapping of these things. And I think that when you look at financial conditions, the financial condition that matters most for the real economy is and remain has been and remains housing. Right. And this is an area where financial conditions are not tight. Sorry, are not loose. This is an area where financial conditions are still quite tight. Going out, getting a mortgage, you know, this is, this is not something that's not, not a financial condition that I would consider to be excessively easy. And so I think it's, I think it's a mistake and I think it's also a mistake, as I said before, to ask people to experience job losses because you think the stock market is too high. I don't know what the right level for the stock market is. And I think that it's a very challenging question to be able to answer credibly. And to say that we need to create job losses in order to sort of restore the stock market to some level that we think is more reflective of fair value is just not a policy view that I hold.

[Radio Host]

A lot of people have come on the show and said that right now the Fed is stuck between a conundrum of the K shaped economy where you have people at the upper end who are doing just fine and are supporting consumption and people on the lower end who are experiencing a lack of wage gains and they're experiencing those job losses. More significantly, how concerned are you about sort of your dual roles of trying to help prop up and prevent some of those job losses from really escalating while at the same time potentially cutting rates would exacerbate that K shaped. And you only exacerbate what you're seeing with respect to the wealth divide.

[Fed Governor Stephen Myron]

So Congress didn't task us with addressing all social problems in the world, inequality one of them. They tasked us with tackling aggregate maximum employment and stable prices. And so therefore the right policy to take is to stabilize employment and prices. And that's the policy, that's the policy that I support. I do think though, while discussing the subject of inequality, it would be much worse for the people at the lower end of the income distribution if the unemployment rate continued to go up as a result of our policies. That's not something that they would be that they would welcome and it's not something that I would welcome either.

[Political Correspondent]

Governor, I was with the President this week in the Oval Office and I asked him about the Fed interviews. He says, lots of names. We may go the standard way, quote, it's nice every once in a while to go politically correct out of the names that we know that are being interviewed. Who is politically correct?

[Fed Governor Stephen Myron]

You know, I don't really know the answer.

[Political Correspondent]

But you worked for the president, so you understand how his mind works. Do you think it means someone that is currently on the board, like a Governor Waller or someone that's very close to him and your former colleague Kevin Hassett?

[Fed Governor Stephen Myron]

Yeah. So, I mean, it should be pretty clear that I just always say what's on my mind, and therefore, I don't even know what politically correct is. So I don't even know how to begin addressing that, you know, but look, I don't. I don't make those decisions.

[Political Correspondent]

You're being too politically correct right now, actually.

[Fed Governor Stephen Myron]

Am I? I've never been accused of that before, so, hey, you know, I'm happy to have it.

[Interviewer]

First, Governor. Very diplomatic. It's good to see you. Thanks for dropping by.

[Fed Governor Stephen Myron]

Thanks for having me.

[Interviewer]

Thank you, sir. Thank you very much. The Fed Governor Stephen Myron with their mustache.

[Fed Governor Stephen Myron]

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[Interviewer]

Nice.

[Fed Governor Stephen Myron]

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