It remains uncertain how far interest rates can fall, though the initial reductions made by the U.S. central bank are a vote of confidence that inflation is returning to its 2% target, Kansas City Fed President Jeffrey Schmid said on Tuesday.
"The decision to lower rates is an acknowledgement of the ... growing confidence that inflation is on a path to reach the Fed's 2% objective - a confidence based in part on signs that both labor and product markets have come into better balance in recent months," Schmid said in remarks prepared for delivery to the Omaha Chamber of Commerce.
He said that while progress back to the 2% target meant it was a proper time to cut rates, it still "remains to be seen how much further interest rates will decline or where they might eventually settle."
Schmid, who will have a vote on the Fed's interest rate policy next year, did not comment on whether he would favor a quarter-percentage-point rate cut at the central bank's Dec. 17-18 meeting.
The bulk of his prepared remarks focused on issues like demographics and productivity that could influence monetary policy over the long run by changing the underlying dynamics of inflation.
But on the more current issue of federal government spending, Schmid said "large fiscal deficits will not be inflationary because the Fed will do its job" to keep inflation at the established 2% target.
That, however, could mean "persistently higher interest rates," Schmid said, a reason why it was important for the Fed to remain independent in setting monetary policy.(Cay) Newsmaker.id
Source: Investing.com
The Federal Reserve cut interest rates by a quarter percentage point on Wednesday and indicated it would continue lowering borrowing costs through the end of the year, as policymakers responded to sig...
The Federal Reserve cut the federal funds rate by 25bps during its September 2025 meeting, bringing it to the 4.00%–4.25% range, in line with expectations. It is the first reduction in borrowing cost...
The United States (US) Federal Reserve (Fed) will announce monetary policy decisions and publish the revised Summary of Economic Projections (SEP), the so-called dot plot, following the September poli...
The Fed is widely expected to slash interest rates at the conclusion of its latest two-day policy gathering, although the size of the possible drawdown and commentary around the move remain a source o...
Bank Indonesia unexpectedly cut its benchmark interest rate by 25 bps to 4.75% at its September 2025 policy meeting, marking the third consecutive monthly rate cut and defying market expectations to h...
The Federal Reserve cut interest rates by a quarter percentage point on Wednesday and indicated it would continue lowering borrowing costs through the end of the year, as policymakers responded to signs of weakness in the labor market. The move...
US stocks closed mixed on Wednesday (September 18) as investors weighed the Federal Reserve's interest rate outlook following an anticipated 25 bps rate cut. The S&P 500 and Nasdaq 100 fell 0.1% and 0.3%, respectively, while the Dow Jones...
Oil prices weakened on Wednesday after data showing rising US diesel stockpiles fueled demand concerns and the US Federal Reserve cut interest rates as expected. Brent crude futures closed 52 cents, or 0.76%, lower at $68.22 a barrel, while US...
President Donald Trump said on Tuesday that the US and China have reached a deal on TikTok. The deal will transfer the assets of the ByteDance-owned...
The U.S. Federal Reserve holds its latest policy meeting this week with a historic challenge to its leadership pending in the courts and a rushed...
European stocks edged lower on Tuesday, with both the STOXX 50 and STOXX 600 slipping 0.2%, pausing after three straight sessions of gains. Traders...
US stocks closed higher on Monday (September 15), driven by gains in technology stocks after President Donald Trump indicated that U.S.-China trade...