Federal Reserve Governor Stephen Milan has announced his intention to resign from the central bank's board shortly after, or even before, the formal swearing-in of incoming Chairman Kevin Warsh. This move was widely anticipated by the market, as Warsh is set to take over Milan's seat on the Fed's Board of Governors. In his resignation letter, Milan also criticized the Fed's methods for measuring inflation, warning that if the central bank "does not correct these errors, it will unnecessarily raise unemployment while responding to 'false inflation' rather than actual inflation." Milan expressed enthusiasm for the reform initiatives Warsh plans to advance at the Fed, including reshaping the central bank's communication mechanisms and balance sheet policy framework. Milan joined the Fed in September of last year. Initially, he took an unpaid leave from his White House position upon joining, before formally resigning from the White House in February this year. As a well-known dovish official, Milan voted in favor of interest rate cuts at every policy meeting during his tenure as a policymaker, dissenting on multiple occasions to advocate for larger rate reductions than his colleagues agreed upon. The Senate narrowly confirmed Warsh as Fed Chairman on Wednesday, clearing the path for his swift swearing-in after current Chairman Jerome Powell's term concludes on Friday.
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