Federal Reserve Chairman Kevin Warsh said inflation risks have eased as energy costs retreated following a U.S.-Iran agreement, but he declined to signal the Fed’s next move on rates. Speaking at the ECB’s Sintra forum with Christine Lagarde and other peers, Warsh said an AI-driven surge in capital spending is lifting demand now and could later increase supply, productivity and employment—even as it contributes to higher equipment and electronics prices in the near term. He reaffirmed the Fed’s independence amid political pressure and noted steady labor markets and resilient demand. The Fed held rates steady at his first meeting as chair, after May CPI rose 4.2%, and is watching whether energy’s spike filters into broader prices. The FOMC meets again July 28–29.
Related articles:
– U.S. Monetary Policy: The Federal Reserve’s Actions
– OECD.AI Policy Observatory: Jobs, Skills and AI
– Monetary Policy (Bank of Canada)
– Personal Consumption Expenditures Price Index (BEA)
