Fed Fixates on AI, But It’s Not Ready to Make Big Greenspan Bet

Like everyone else, policymakers at the Federal Reserve are increasingly obsessed with artificial intelligence and its promise of a turbocharged economy. They’re just not ready to make a big call that the revolution is under way.

Analysts across the financial world are scouring data for signs AI is making the economy more productive – the holy grail of new technology. The last sustained boost of that kind was the 1990s internet boom. Back then it shaped Fed policy: Chair Alan Greenspan reckoned innovation would allow faster growth without triggering inflation, and used that argument to keep interest rates down.