Kansas City Fed’s Schmid says inflation remains too high and rates are too accommodative ahead of Jackson Hole
AI Market Summary
Kansas City Fed President Schmid signaled policy is still too accommodative with inflation "too hot" ahead of Jackson Hole, highlighting recent 20%–30% agricultural commodity gains as a renewed inflation impulse and noting core PCE remains elevated. The tone reinforces expectations for a longer restrictive stance and a potentially firmer reaction function to unfavorable inflation data, pressuring rate-sensitive assets while supporting front-end yields and the dollar.
Impact level
● High
Affected assets
NCSIDXY2USD/USDT+0.03%
AI Insight · NCSIDXY2USD/USDTAI Insight
▼ Bearish
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Kansas City Federal Reserve President Jeff Schmid said ahead of the Jackson Hole gathering that policy is still too accommodative while inflation remains above the Fed’s 2% goal. He highlighted a 20% to 30% surge in agricultural commodities in recent weeks as a potential new source of inflation pressure. Schmid also downplayed the impact of possible renewed U.S.-Canada tariffs, calling them a small part of the broader economy. His comments reinforced concerns that the Fed could keep policy tight for longer.
