Fed's Schmid: Interest Rates May Be 'Near' Long-Run Level

Federal Reserve Bank of Kansas City President Jeff Schmid expressed his views on Thursday, stating that the Federal Reserve's interest rates might be "very close to their longer-run level now." He emphasized the importance of a neutral policy stance, given the current inflation and growth momentum.

Speaking at the Economic Club of Kansas City, Schmid advocated for a gradual adjustment of policies, only in response to sustained changes in economic data. He highlighted the Fed's significant role during the pandemic, including doubling its balance sheet to stabilize financial markets. Schmid also pointed out the need for further reduction in the balance sheet to minimize the Fed's impact on financial markets.