In a closely contested vote on Monday, the U.S. Senate confirmed Stephen Miran, currently the White House chief economist, to the Federal Reserve Board with a narrow margin of 48-47. This confirmation comes just in time for Miran to participate in the central bank's crucial interest-rate setting meeting, which begins Tuesday.

This appointment marks President Donald Trump's first significant influence on the Federal Reserve during his second term. It raises concerns about the potential for increased presidential influence over the traditionally independent central bank. Miran will not resign from his role as chair of the Council of Economic Advisers but will instead take a leave of absence. This unusual decision has sparked debate, although Republican senators have backed the arrangement, highlighting that Miran’s term is set to end in January.

Trump has been vocal throughout the year about his dissatisfaction with Fed Chair Jerome Powell’s decision to maintain high interest rates. Miran has echoed the President's calls for lower borrowing costs. However, Powell has indicated that the Fed is likely to reduce rates soon due to a weakening job market, a move he asserts is independent of any external political pressure.

Miran, who earned his Ph.D. from Harvard University, has expressed his intention to return to the White House after his Fed term concludes. Yet, he has not ruled out the possibility of an extended stay at the Federal Reserve, which could occur if President Trump is unable to replace Fed board member Lisa Cook. The litigation surrounding Cook’s potential dismissal could leave Miran as Trump’s only opportunity to appoint a new Fed chair, which may extend his influence within the central bank.

Before his tenure in the Trump administration, Miran proposed several controversial reforms aimed at increasing presidential control over the Federal Reserve. These included suggestions to make it easier to dismiss Fed board members and to shorten their 14-year terms. Since joining the administration, Miran has maintained that tariffs imposed by the government are unlikely to fuel inflation that would necessitate a Fed response—a viewpoint that contrasts with Powell’s cautious stance on the same issue.

This confirmation and the potential implications it holds for the independence of the Federal Reserve are likely to be closely watched by economists and policymakers alike, as the central bank navigates the complexities of a fluctuating economy and ongoing political pressures.