Fed's Cook (28 Sep): AI may already cut demand for coders, translators, entry-level staff; rate cuts may not fix it
3 items, from 28 Sep 2026 to 7 Oct 2026, oldest first.
Markets · Policy ·
Fed's Cook (28 Sep): AI may already cut demand for coders, translators, entry-level staff; rate cuts may not fix it
Fed Governor Lisa Cook said AI 'could bring the most significant reorganization of work in generations', that it may be reducing labour demand in software coding, translation and entry-level tasks, and that cutting rates against AI-driven, skills-mismatch unemployment 'could risk fueling inflation', with inflation at 3.8% and power and water costs up about 5%.
Why it matters. A Fed governor says AI may already be cutting some jobs and that lowering interest rates might not help those workers without fuelling inflation.
Next. US job openings on 29 Sep and payrolls on 2 Oct.
Fed's Barr (29 Sep): 'further policy adjustments are likely' after September hike; AI may substitute for young workers
Governor Barr said inflation has been above 2% for five and a half years, the labour market is in rough balance at 4.1% unemployment, and more tightening is likely needed; he added that AI already looks like a labour substitute for younger, less experienced workers and that a lasting productivity boost would mean higher equilibrium rates.
Why it matters. A Federal Reserve governor says more rate rises are likely and that AI may already be replacing young workers, while also arguing that an AI productivity boom would keep interest rates higher for good.
Next. The Fed's next decision on 28 October; US September jobs report on 2 October.
Fed minutes (7 Oct): most officials see another hike 'likely' by year end; AI build-out 'surprised to the upside'
Minutes of the 15-16 September meeting, which raised the federal funds range to 3.75-4% by 12 votes to 0, say most participants judged another increase likely appropriate by year end. Several said the AI build-out's scale and pace kept surprising to the upside, and some warned AI-related demand could push demand above supply; staff put August PCE inflation at 3.8%, core 3.4%.
Why it matters. Most US central bankers expected to raise rates again before year end, and several described investment in AI as a source of demand large enough to keep inflation up. If they act on this while hiring stays weak, higher borrowing costs could meet a labour market with little slack to absorb them.
Next. US inflation for September in mid-October and the Fed's decision on 28 October.