KC Fed President Jeff Schmid Remains “Squarely Focused” on Inflation as Tariffs Loom

Posted April 10, 2025

Following the announcement of President Donald Trump’s decision to place a 90-day pause on some of the tariffs, Kansas City Federal Reserve President Jeff Schmid said he is “squarely focused” on inflation moving forward.

“I intend to keep my eye squarely focused on the outlook for inflation,” Schmid said during his speech at the Structured Finance Network’s Independent Finance Roundtable held in Kansas City on Thursday.

“While in theory, tariffs may have only temporary effects on inflation (although persistent effects on the level of prices) I would be hesitant to take too much solace from theory in this environment. Given the recent experience with high inflation, I am concerned that any further jump in prices could further push up inflation expectations,” he said.

In a social media post on Truth Social, Trump announced he had raised a tariff on China to 125% effective immediately and authorized a 90-day pause on reciprocal tariffs. Days before the announcement U.S. stock slumped as trade partners were preparing for the 10% tariff on most countries.

The Fed had shown some promise in decreasing inflation in the past month. The Consumer Price Index data for March showed inflation began to slow, increasing only to 2.4% compared to expectations of 2.6%. It is unclear what effects Trump’s tariffs could have on U.S. inflation after the 90-day pause is complete, however, Schmid remarked the Fed has effectively kept down long-term inflation.

“Now, with renewed price pressures likely, I am not willing to take any chances when it comes to maintaining the Fed’s credibility on inflation,” he said.