Kansas City Federal Reserve President Jeffrey Schmid has expressed doubts about whether the central bank will lower interest rates in September as widely hoped by investors.
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In an interview on CNBC, Schmid said that the U.S. Federal Reserve has more work to do to bring inflation in line with the central bank’s annualized 2% goal. Speaking from the Fed’s symposium in Jackson Hole, Wyoming, Schmid also pushed back on market expectations for the U.S. central bank to lower borrowing costs next month.
“I think we really have to have very definitive data to be moving that policy rate right now,” he said. “In September, we’ll get around tables and we’ll collaborate and we’ll figure it out, but yeah, I think there’s a lot to be said between now and September.”
Pressure on the Fed
Schmid is a voter on the Federal Reserve’s rate-setting committee and will have input into the central bank’s September decision. The Kansas City Fed each year hosts the Jackson Hole gathering, which will culminate in Fed Chair Jerome Powell delivering a widely watched keynote address on Aug. 22.
Schmid’s comments come with futures traders pricing in a nearly 80% chance of a 25-basis point rate cut on Sept. 17 of this year. The comments also come after the latest Fed meeting minutes showed central bankers remain worried about inflation and the impact of U.S. President Donald Trump’s tariffs.
President Trump continues to demand that the U.S. Federal Reserve lower interest rates to boost the economy and stock market. He has threatened to fire Fed Chair Powell and called for the resignation of other central bank governors.
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