Economists doubt AI will cut inflation enough for Fed to lower interest rates

In a snap poll conducted by the University of Chicago’s Clark Center with the Financial Times, nearly 60% of leading economists said artificial intelligence is unlikely to reduce inflation or borrowing costs meaningfully over the next two years. Their view contradicts Kevin Warsh, Donald Trump’s nominee for Fed chair, who argues AI-driven productivity will justify cutting rates from the current 3.5%–3.75% range without rekindling inflation. Many respondents also flagged tensions around Warsh’s push to shrink the Fed’s balance sheet further and his support for bank deregulation.