Schmid Seeks Tighter Monetary Policy to Tame 'Too High' Inflation

Federal Reserve Bank of Kansas City President Jeff Schmid has called for tighter monetary policy to combat 'too high' inflation, which he believes requires bringing prices back down to the Fed's two percent target.

In a speech, Schmid said that while the economy is performing well, inflation remains his primary concern. He noted that recent data suggests monetary policy is not restrictive enough and needs to lean against price pressures.

Schmid'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 percent and 3.75 percent. However, some Fed officials voted in favor of a hike to quell inflationary pressures.

The official cautioned against downplaying inflation caused by supply shocks, citing the recent rise in energy prices, which has proven short-lived due to ongoing geopolitical tensions.