Powell: Core Inflation Pressure Concerning, AI Investment Driving up Prices

BlockBeats News, July 14th, Federal Reserve Governor Waller stated that if this week's core inflation data remains high, the Fed will need to consider raising interest rates in the near future.

Waller expressed concerns about the recent rise in core inflation, citing tariffs, increasing energy prices, and demand for artificial intelligence investment as the main drivers of inflation. He expects overall inflation to slow down starting this week, but core inflation will remain a key indicator to watch.

However, Waller also noted that if core inflation continues to decline, maintaining the interest rate unchanged would still be a reasonable choice. He reiterated that the Fed is committed to bringing the inflation rate back to the 2% target while avoiding policy tightening that could lead to an economic downturn.

Furthermore, Waller believes that the U.S. labor market remains strong, close to the Fed's maximum employment goal, with robust consumer spending and business investment. He expects continued growth in artificial intelligence-related investment.