AI Won't Save Economy from Near-Term Inflation: Fed's Lisa Cook

Federal Reserve Governor Lisa Cook is warning that artificial intelligence (AI) may not be enough to save the economy from near-term inflation.

Cook expects AI to offer mild disinflationary benefits, but only over the next few years. This means that immediate price pressures will remain unchecked.

The problem lies in the heavy infrastructure spending on AI, which is driving up costs for power and labor. As a result, utility costs have risen by about 5% over the past year.

Cook characterized AI as 'the most significant technological shift of our lifetime', but emphasized that there is still significant uncertainty surrounding how quickly efficiency gains will materialize.