Kevin Warsh has little to say about interest rates. But he has plenty to say about AI | CNN Business

Washington —

Federal Reserve Chairman Kevin Warsh has been outspoken about AI and its potential economic benefits. His view on where interest rates are heading, however, is harder to pin down.

In the nine weeks since taking the helm at America’s central bank, Warsh has declined to publicly discuss what recent economic trends mean for rates, abandoning the long-held practice of providing “forward guidance.” He reinforced that approach last week after the Fed’s latest decision to hold its benchmark lending rate steady for the fifth consecutive time, saying it’s been “a change for the better.”

Warsh has been much more forthcoming about AI. He said robust business investment, much of it driven by demand for AI infrastructure, “is preparing the ground for future growth.” He has also argued that AI could boost productivity and even lower inflation, which would give the Fed room to cut rates.

By repeatedly highlighting the potential economic boom from AI, he is drawing attention to a development that would strengthen the case for cutting rates.