Fed’s Schmid backs wait-and-see stance amid uncertainty

Speaking overnight, Kansas City Fed President Jeff Schmid called Fed’s “wait-and-see” stance appropriate, especially given that inflation remains above target and the effects of rising tariffs are still filtering through the economy. “The resilience of the economy gives us the time to observe how prices and the economy develop,” he added

Schmid noted that business contacts “almost uniformly” expect tariffs to drive prices higher and weigh on activity, putting Fed’s inflation and employment mandates at odds. But “there is far less clarity on when and by how much,” said Schmid, who argued there’s little justification for near-term rate adjustments until the economic picture becomes clearer.