Fed's Cook Sees Ongoing Inflationary Pressures Ahead

Federal Reserve Governor Lisa Cook expects continued inflationary pressures in the coming months due to AI-related demand and higher oil prices, although she did not confirm any additional interest rate hikes.

Cook made these remarks during a conference on AI and emerging technology in Oakland, California. The labor market appears well positioned to handle an increase in rates, according to Cook.

The Fed raised its policy rate this month for the first time in three years to help bring inflation back to the central bank's 2% goal. Cook joined the unanimous vote in support of the decision and noted that policymakers expect one more rate hike by the end of this year.

Cook expects AI-driven productivity gains to deliver some disinflation over the medium term but said those gains will not come fast enough to offset inflationary pressures this year.