Feds Schmid: Surging oil is weighing on spending power

Finance

Feds Schmid: Surging oil is weighing on spending power

Kansas City Federal Reserve (Fed) Bank President Jeffrey Schmid said during the European trading session on Friday that elevated energy prices are diminishing households purchasing power.

Additional remarks

Some evidence AI is depressing hiring but not driving firing.

US economy less exposed to energy shock relative to the past.

Main focus is on getting inflation back to 2% target.

So far, US energy producers have not been moving to invest in more production.

Most data points to continued economic growth.

Job market in balance, buoyed in part by healthcare hiring.

Fed must signal commitment to lowering inflation.

My primary concern is inflation, which is ‘too hot’.

I place little stock in believing recent inflation jump is transitory.

Low hiring is a more general phenomenon, not only due to AI.

The Fed must signal commitment to price stability.

Market reaction

There seems to be no immediate response by the US Dollar (USD) to Fed Schmids comments. As of writing, the US Dollar Index (DXY) trades 0.1% higher at around 99.10.