MNI BRIEF: Fed's Jefferson - Too Soon To Tell Impact Of AI

Federal Reserve Vice Chair Philip Jefferson Friday said artificial intelligence may well represent a structural change in the economy, but it is too early to say the impact on monetary policy. 

"In terms of AI’s implications for monetary policy, it is likely still too soon to tell. Policymakers must sort out changes in the economy that are due to cyclical factors from
those resulting from structural change, which AI may well represent," he said in prepared remarks. "Productivity gains from AI may affect the relationship between employment and inflation and, hence, the conduct of monetary policy." 

Monetary policy decisions need to be made with a broad view of what is happening in the economy, not just in one sector or technology, he told a Cleveland Fed conference. "There is still much to learn. I counsel exercising humility about the challenges in predicting AI’s effects on employment and inflation."