The Federal Reserve's benchmark rate is "fairly accommodative" right now, according to Kansas City Fed President Jeff Schmid, joining a chorus of officials suggesting that hikes are coming.
Schmid said Tuesday that inflation continues to be top of mind for policymakers as they weigh adjustments to the federal funds rate, particularly as the employment picture remains steady and consumer spending keeps moving along.
"Underneath there's still a lot of demand," Schmid said at a Fed conference in Houston. "We've got to continue to focus on that demand and make good policy decisions to equalize what's happening between inflation and labor."
Schmid isn't a voting member of the Fed's rate-setting committee right now, but when he was in 2025, he dissented against the central bank's final two rate cuts of that year. The rate wasn't adequately restrictive then and still looks too loose today, he said Tuesday.
Fed governor Christopher Waller and Dallas Fed President Lorie Logan also gave hawkish comments on Tuesday, with Waller suggesting that a half-point rate increase could be on the table next month. Waller and Logan both have votes on rate-setting committee.
The odds of a half-point hike are now at just under 10%, compared with odds for a quarter-point hike at over 90%, according to CME's FedWatch tool.
The hawkish commentary comes on the same day as a hotter-than-expected inflation report for October, which has raised the prospect of getting back-to-back rate hikes in December and January, according to analysts.
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