Kansas City Fed's Schmid Backs Rate Hike, Citing Persistent Inflation Concerns

By EC Assets · Published 18 September 2026

Kansas City Federal Reserve President Jeff Schmid stated his support for a recent interest rate hike, viewing it as a necessary step to combat inflation. Schmid maintains that inflation remains too elevated. He also expressed doubt about the appropriateness of lowering rates in September. Schmid supported the Federal Open Market Committee's (FOMC) decision to increase the federal funds rate target range. The FOMC raised the target range by 25 basis points to 3.75%-4.00% on Wednesday. He indicated there is still work to do on inflation. Schmid previously commented on Thursday that cutting interest rates could exacerbate inflation. He suggested this would overshadow any potential benefits for the job market. He stated that he currently sees inflation as too high. On Wednesday, speaking at the Economic Club of Colorado, Schmid reiterated his concerns about inflation. The Kansas City Fed President remains focused on inflation, also considering the risks new U.S. import taxes could pose to prices. He will maintain this focus in light of potential tariff risks. Despite his inflation concerns, Schmid holds an optimistic view regarding artificial intelligence (AI). He believes AI will eventually foster non-inflationary, supply-driven economic growth. He discussed this outlook in the context of monetary policy and the economy. Central banks have recently raised rates to address inflation. This action has contributed to dips in both stocks and bonds. This article is intended for informational purposes only. It does not constitute investment advice.