Business · Economy · 48 mins ago
Fed chair says AI could reshape the global economy
Fed chair Kevin Warsh called AI a defining economic change while speaking in Bangkok during meetings of the IMF and World Bank.
AI investment is helping drive global growth and trade, while also lifting stock markets in the US and Asia.
Warsh said the investment surge could push prices higher in the short term, but AI could eventually make economies more productive and create wealth.
The effects on jobs over the next 12 to 18 months remain unclear.
The boom also brings risks, including a sudden market downturn if investment or expected gains fall short.
The IMF has warned that such a reversal could threaten financial stability.
Warsh gave no indication of the Fed’s next interest-rate move, saying it assesses current data at each meeting.
Fed Chair Kevin Warsh said artificial intelligence could be the most consequential change for the U.S. and global economies in his lifetime.
He said AI investment is boosting demand and could put upward pressure on prices in the near term.
Warsh expects AI to raise productivity and create wealth over time, though he described the path as uncertain and “very bumpy.”
He did not indicate whether the Federal Reserve would raise interest rates again or when.
A Fed task force studying AI’s effects on productivity and jobs is due to hold a public hearing in the San Francisco Bay Area on Nov. 16.
- Who
- Kevin Warsh, chair of the U.S. Federal Reserve.
- What
- He said AI could reshape the U.S. and global economies, bringing near-term inflation pressures and potential longer-term productivity gains.
- When
- He made the remarks on Friday, Oct. 16, 2026.
- Where
- At the IMF and World Bank annual meetings in Bangkok.
- Why
- He was discussing AI’s economic effects, including its impact on demand, inflation, productivity and employment.
This story does not have two clearly opposing sides.
The Fed raised interest rates to a range of 3.75% to 4% to fight inflation.
Warsh discussed AI and the economy at the IMF and World Bank annual meetings in Bangkok.
A Fed task force on AI’s effects on productivity and jobs is due to hold a field hearing in the San Francisco Bay Area.
- Fed chair
- Kevin Warsh
- Interest-rate range
- 3.75% to 4% after the September increase
- Near-term AI effect
- Investment-driven demand could put upward pressure on inflation
- Longer-term AI effect
- Warsh expects greater productivity and wealth
- Field hearing
- Nov. 16 in the San Francisco Bay Area
4 sources
Fed’s Warsh sees U.S. resilience amid AI boom, mum on rate-path view
IA é a mudança mais importante que a economia que já viu, diz presidente do Fed
Le patron de la Fed voit dans l'IA le «changement le plus déterminant» de sa vie pour l'économie mondiale
La Fed alerte sur l’IA, «le changement le plus déterminant» pour l’économie
What people are saying
I don’t prejudge meetings.
It’s obviously hitting the demand side of the economy before it’s going to hit the supply side of the economy
really there is, I think, an enormous benefit for the global economy and the U.S. economy in the long term
The path will probably be bumpy: uncertainties about our very understanding of the technology, but also about the market structure that will ultimately emerge. Who will manage to benefit from it? What consequences for those who bet on gains, but whose hopes run up against reality?