Fed’s Schmid Talks Policy, Inflation, Credibility, Communication

Summary

Kansas City Fed President Jeff Schmid discusses his view that policy may be accommodative rather than restrictive and that a rate hike could make sense as soon as September 16. He also says the October 28 FOMC meeting is not off the table due to the election. He highlights technology and data-center demand as an inflation driver for commodities such as steel and copper, and he defends the Fed's credibility and communication agenda.

• Schmid sees monetary policy as possibly accommodative, especially on the short end.
• He says a bit higher policy rate might make sense as soon as September 16 but wants more data.
• He does not believe the October 28 FOMC meeting is off the table because of the election.
• He flags technology demand and data-center buildout as boosting steel and copper demand and inflation.
• He dismisses concerns about a Fed credibility problem.
• He expects Fed communication, meeting schedule, and real-time data issues to be key task-force topics.