Central Bankers Split on AI, Supply Shocks, and Tariffs

BoE Governor Bailey suggested that AI could be a positive force in an era of negative supply shocks. This is in contrast to other central bankers, including Fed's Williams, who have expressed concerns about persistent supply shocks.

Fed's Williams also stated that tariffs generally do not produce sustained inflation and emphasized the need for the Fed to ensure that shocks do not become entrenched. Meanwhile, Japan's Finance Minister Katayama noted that US President Trump voiced worries over a weak yen during their summit.

Katayama also mentioned that Japan will closely coordinate with the US on foreign exchange and that he expects the Bank of Japan to implement suitable monetary policy while cooperating with the government. However, when asked about discussing particular forex levels or rate interventions, Katayama declined to comment.