--- title: "Public and Waller \"singing a different tune\"? Multiple Federal Reserve officials state: AI-enhanced productivity may imply \"higher neutral interest rates\"" description: "The Federal Reserve's room for interest rate cuts this year may further narrow, and the futures market has now pushed back the expectation for the first rate cut to after mid-year" type: "news" locale: "en" url: "https://longbridge.com/en/news/276190662.md" published_at: "2026-02-18T02:19:50.000Z" --- # Public and Waller "singing a different tune"? Multiple Federal Reserve officials state: AI-enhanced productivity may imply "higher neutral interest rates" > The Federal Reserve's room for interest rate cuts this year may further narrow, and the futures market has now pushed back the expectation for the first rate cut to after mid-year Several Federal Reserve officials recently stated that **the productivity growth brought about by artificial intelligence may imply higher interest rate levels**, a view that sharply contrasts with the stance of the Trump administration and its Federal Reserve chair nominee, Walsh. Federal Reserve Governor Michael Barr said in a speech in New York on Tuesday that **he expects the AI boom is unlikely to be a reason for lowering policy rates. He pointed out that factors such as capital demand and household savings may exert upward pressure on interest rates.** San Francisco Fed President Mary Daly also stated that **under the "standard model," the acceleration of productivity growth triggered by AI will lead to a higher neutral rate, as investment demand will rise relative to savings supply.** This analysis poses a challenge for investors hoping for rate cuts. According to futures market pricing, **investors currently expect the Federal Reserve will not cut rates before mid-year.** After holding steady at the January meeting, the Fed has maintained the benchmark rate in the range of 3.5% to 3.75% following three rate cuts in 2025. ## Divergence from Trump Camp's Position The Federal Reserve officials' judgment on the relationship between AI and interest rates starkly contrasts with the views of the White House and its Federal Reserve chair nominee, Walsh. President Trump has continuously pressured the Federal Reserve to lower borrowing costs. Walsh echoed the government officials' viewpoint, suggesting that AI could unleash a productivity boom, leading to non-inflationary growth accompanied by lower rates. However, differing opinions are forming within the Fed. Federal Reserve Vice Chairman Philip Jefferson had already suggested in a speech on February 6 that, all else being equal, a sustained increase in productivity growth could lead to a rise in the neutral rate, at least temporarily. As President Powell's term is set to expire in May, the issues of AI and productivity are expected to play an increasingly important role in this year's interest rate debates. ## Transmission Mechanism of AI Pushing Up Rates Barr elaborated on several reasons why AI could push up interest rates in his speech. **He pointed out that leveraging this technology requires strong corporate investment, which will lead to increased capital demand, thereby exerting upward pressure on interest rates.** Additionally, due to stronger expectations for real wage growth and higher lifetime income, household savings may decline, which would also exert upward pressure on interest rates. After an event in San Jose, California, Mary Daly told reporters that because investment demand will rise relative to savings supply, the acceleration of productivity growth triggered by AI will require a higher neutral rate under the "standard model." However, she also acknowledged that any analysis is far from definitive. "Perhaps it will lead to a slight increase in the neutral rate," she said, "we need to maintain a degree of humility regarding the impact on the neutral rate." ## Signals of Policy Shift Becoming Apparent The Federal Reserve has cumulatively cut rates by 175 basis points over the past year and a half, having previously raised rates by over 500 basis points in 2022 and 2023. Currently, several officials believe that the current rate level is close to the neutral level for the economy, using this as a reason to slow down or halt rate cuts. Futures markets indicate that investors currently expect the Federal Reserve will not cut rates again before mid-year. **This expectation aligns with the latest judgments from Fed officials regarding the impact of AI, suggesting that monetary policy may maintain its current stance for a considerable time.** \*\* ### Related Stocks - [IDGT.US - iShares US Digital Infrastructure and Real Estate ETF](https://longbridge.com/en/quote/IDGT.US.md) - [QQQM.US - Invesco Nasdaq 100 ETF](https://longbridge.com/en/quote/QQQM.US.md) - [.SPX.US - S&P 500](https://longbridge.com/en/quote/.SPX.US.md) - [ARTY.US - iShares Future AI & Tech ETF](https://longbridge.com/en/quote/ARTY.US.md) - [QQEW.US - First Trust NASDAQ-100 Equal Weighted](https://longbridge.com/en/quote/QQEW.US.md) - [.IXIC.US - NASDAQ Composite Index](https://longbridge.com/en/quote/.IXIC.US.md) - [DTCR.US - Global X Data Center & Dgtl Infrs ETF](https://longbridge.com/en/quote/DTCR.US.md) - [NDAQ.US - Nasdaq](https://longbridge.com/en/quote/NDAQ.US.md) - [XDAT.US - Franklin Exponential Data ETF](https://longbridge.com/en/quote/XDAT.US.md) - [ONEQ.US - Fidelity Nasdaq Composite Index ETF](https://longbridge.com/en/quote/ONEQ.US.md) ## Related News & Research | Title | Description | URL | |-------|-------------|-----| | 資本集團憂傳統長線投資概念失效「市場波動難向客戶提供方案」 | 資本集團的陳婉貞表示，市場對美國經濟不確定性、政策影響及美元走勢的關注加劇，傳統長線投資概念面臨挑戰。儘管投資者現金充裕，但在波動的市場環境中，難以提供吸引的長線投資方案。資本集團的 Andy Budden 對 AI 推動經濟增長持樂觀態度 | [Link](https://longbridge.com/en/news/275427149.md) | | REG - BNP Paribas Easy - 淨資產值 | BNP Paribas Easy ICAV 已於 2026 年 2 月 13 日發佈了其每日基金價格。各類 ETF 的淨資產價值（NAV）包括：BNP Paribas Easy S&P 500 Scored and Screened UCI | [Link](https://longbridge.com/en/news/276058088.md) | | 06:00 ETDeepL 通過 AWS Marketplace 向全球企業提供 AI 翻譯服務 | DeepL 是一家全球性的人工智能產品和研究公司，已宣佈其 AI 翻譯和寫作輔助解決方案在 AWS Marketplace 上可用。客户現在可以通過 DeepL API 訪問這些解決方案，從而更方便地採購並集成到現有的 IT 環境中。此舉旨 | [Link](https://longbridge.com/en/news/276114786.md) | | 特朗普的關税政策在 2025 年使美國家庭平均損失約 1000 美元 | 特朗普的關税將在 2025 年使美國家庭損失約 1000 美元 | [Link](https://longbridge.com/en/news/276087798.md) | | 紐約聯儲報告稱，美國企業和消費者承擔了特朗普關税成本的 90% | 根據紐約聯邦儲備銀行的一份報告，美國企業和消費者承擔了大約 90% 的特朗普總統關税相關費用。研究表明，在 2025 年的前 11 個月，94% 的經濟負擔落在了美國人身上，這與特朗普聲稱外國公司將支付關税的説法相矛盾。平均關税率從 202 | [Link](https://longbridge.com/en/news/275922363.md) | --- > **Disclaimer**: This article is for reference only and does not constitute any investment advice.