Federal Reserve's Schmid advocates maintaining restrictive interest rates to address inflation

Federal Reserve's Schmid stated that interest rates should be maintained at a level that continues to exert pressure on the economy to further reduce inflationary pressures. He believes that a cooling of the labor market may be necessary to prevent a worsening inflation outlook. Schmid reiterated that further interest rate cuts may not effectively stimulate recruitment, and the slowdown in growth is mainly driven by structural changes in technology and immigration policies. He is concerned that interest rate cuts may have a more lasting impact on inflation and emphasizes that the Federal Reserve's commitment to the 2% inflation target is facing challenges.