5 Jeffrey Schmid’s Highlighted Statements: Fed Won’t Cut Interest Rates Again!

Jakarta, Pintu News – Kansas City Federal Reserve Bank President Jeffrey Schmid has once again captured the attention of global financial markets. In his speech on October 6, 2025, Schmid stated that he does not support additional interest rate cuts by the Fed.

This decision is considered important because it is directly related to the rate of inflation, economic stability, and the movement of crypto markets and precious metals such as gold. Check out the 5 main points that have been discussed from Schmid’s statement and how this can be monitored by crypto investors and financial markets.

1. High inflation is the main reason for Fed’s reluctance to cut interest rates

According to a report by Cryptopolitan, Jeffrey Schmid thinks that the high level of inflation makes cutting interest rates a risky move. He emphasized that the Fed must maintain its credibility in controlling inflation, despite the general strength of the economy.

Based on official data, service sector inflation is currently stable at 3.5%, well above the Fed’s target of 2%. In fact, Schmid revealed that in August 2025, 80% of expenditure categories showed price increases, up from 70% at the start of the year.

Also Read: 5 Ways to Check Crypto Wallet: Monitor Assets & On-Chain Activity in Real-Time

2. Fed Split: Some Support, Some Reject

The internal debate among Federal Reserve officials was also in the spotlight. Some figures such as Lorie Logan (Dallas Fed) and Beth Hammack (Cleveland Fed) rejected further interest rate cuts for fear of worsening inflation.

However, a different view came from the new member of the board of governors, Stephen Miran, who received support from Michelle Bowman (Fed Vice Chair) and Mary Daly (San Francisco Fed). They think lower interest rates could help the slowing job market.

3. Labor Market Still Strong, But There Are Signs of Doubt

Schmid stated that although the unemployment rate is at 4.3%, which is relatively low, companies are starting to delay hiring due to economic uncertainty. One reason is President Donald Trump’s high tariff policy and the uncertainty of AI’s impact on future labor needs.

This condition makes the Fed’s policy more complex: if interest rates are cut to boost employment, inflation may spike. If interest rates are held high, the risk of unemployment increases.

4. AI and Investment Keep Growing Despite High Interest Rates

Interestingly enough, Schmid notes that despite high interest rates, investment in the AI sector continues to grow. Corporate spending on AI-based software is increasing, and this suggests that technological innovation remains the real economy’s version of a resilient altcoin-attractingthe attention of many investors.

This is also in line with stock and bond market conditions. According to Schmid, equity markets are close to their highest levels, and corporate bond spreads are at their lowest-signaling that market confidence is still strong.

5. Impact to Crypto and Gold: Investors Seek Safe Assets

The decision not to cut interest rates in the near future will likely get a boost from the crypto and gold markets. Both are known as hedging instruments, especially during times of high inflation and economic uncertainty.

Bitcoin rose to $127,000 or around Rp2.1 billion (at an exchange rate of 1 USD = Rp16,607), and antam gold also jumped to Rp2,296,000/gram as of October 8, 2025. This shows that investors are still buying safe assets while waiting for the certainty of the Fed’s policy direction going forward.

Also Read: 5 Coin Memes Predicted to Explode After Bitcoin Breaks $125,000

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Reference:

• Nellius Irene / Cryptopolitan. Kansas City Fed’s Schmid pushes back on further rate cuts. Accessed on October 8, 2025
• Featured Image: CNBC