Goolsbee says artificial intelligence is an inflation problem
The Chicago Fed president's comment, reported by Semafor, sharpens a hawkish case that has kept long-dated Treasury yields elevated this month.
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Chart: US10Y, US 10-year Treasury yield, one-minute prices, three sessions
Federal Reserve Bank of Chicago President Austan Goolsbee said artificial intelligence is contributing to inflation, Semafor reported.
The comment goes further than Goolsbee's remarks earlier this month, when he spoke of stalled progress on inflation and of price pressure spreading through the economy. Naming AI spending as a specific driver gives his position a firmer footing.
It also lines up with Cleveland Fed President Beth Hammack, who has said inflation pressure is broadening beyond AI spending into other parts of the economy. Taken together, the two officials' remarks have pushed the debate among some Fed policymakers away from whether more tightening is needed and toward how much is still required.
The timing matters for anyone holding long-dated bonds. Patience signals from Governor Philip Jefferson and New York Fed President John Williams had briefly pulled those yields off a 5.24% high, and Goolsbee's framing, if it gains support among other officials, argues against any near-term easing ahead of the next inflation data.