Fed's Schmid Seeks Tighter Policy to Tame 'Too High' Inflation

Federal Reserve Bank of Kansas City President Jeff Schmid has called for tighter monetary policy to address 'too high' inflation. In a speech, Schmid stated that the economy is performing well except for inflation, which he sees as his primary concern.

Schmid emphasized that recent data indicates that monetary policy is not restrictive enough to counteract price pressures, leading him to believe that bringing inflation down to the 2% target will require tighter policy. However, he did not specify when or by how much interest rates should be raised.

The official's remarks come after last week's Federal Open Market Committee meeting, where officials kept the federal funds target rate range steady at between 3.5% and 3.75%. Schmid cautioned against dismissing inflation resulting from supply shocks and noted that recent relief from higher energy prices has been short-lived.