Fed Chair Kevin Warsh Discusses AI's Role in Inflation and Future Rate Hikes at IMF Meeting Federal Reserve Chair Kevin Warsh addressed the IMF and World Bank Group in Bangkok, explaining how the rapid rise of artificial intelligence could influence inflation dynamics and the Fed's monetary policy path. He highlighted the likelihood of additional rate increases this year to curb price pressures and underscored the importance of AI tools for real‑time data analysis to guide policy decisions. The U.S. Federal Reserve Chair Kevin Warsh spoke at the annual meetings of the International Monetary Fund and the World Bank Group in Bangkok on Friday, October 16, 2026. The event gathered central bankers, financial leaders, and policymakers worldwide amid a backdrop of high inflation and rapid technological change. Warsh used the occasion to outline the Fed's outlook on interest rates and to emphasize the growing impact of artificial intelligence (AI) on global economics. During a record‑setting fireside chat with IMF Managing Director Kristalina Georgieva, Warsh reiterated the Fed's commitment to price stability.Warsh Predicts Additional Rate HikeHe remarked that the recent rate increase in September had already begun to remove a winter of accommodation, and that another hike would likely be required later this year to continue slowing inflation."We made it very clear that price stability is our priority, and we pulled back on accommodation in September," Warsh said. "Another rate increase will probably be needed this year to keep the economy on a sustainable path. " The Fed's stance has been a source of tension with President Donald Trump, who has repeatedly urged the Fed to cut rates. While Trump criticized the Fed's decision‑making body, he still publicly endorsed Warsh, who was appointed earlier that year.Despite this political friction, Warsh maintained a restrained tone in Bangkok, noting he would not speculate on the specifics of upcoming policy meetings. A key focus of Warsh's remarks was the surge in investment driven by the excitement around AI. He identified AI transformation as the most consequential change to the U.S. and global economy he has witnessed in his lifetime.AI Technology Reshapes Global Economy"The advent of this new technology is probably the most consequential change to the U.S. and the global economy in my lifetime," he said. Warsh highlighted an upcoming task force meeting on November 16 that would address AI‑related policy issues. Warsh expressed optimism that AI would bring significant benefits to the world economy over time. He noted that the current ability to analyze lagging economic data is limited."We torture data with old‑fashioned models to try to uncover underlying inflation trends," he said. "In the near future, we will have access at the fingertips of central banks to all the information in the world, and we'll be able to use new analytical tools to distill that data. " The Chairman's observations underscore a broader shift toward technology‑enabled monetary policy.Central Banks Adopt Real Time AnalyticsCentral banks around the world are seeking ways to incorporate real‑time data streams, predictive analytics, and machine‑learning models to enhance forecasting accuracy and policy responsiveness. Warsh's comments signal that the Fed is actively pursuing these avenues to better navigate the complex interactions of AI, innovation, and economic growth.In sum, Warsh's address in Bangkok highlights the Fed's intention to continue tightening policy to counter inflation while simultaneously investing in AI tools that promise to transform how central banks process information and formulate decisions. His remarks aim to reassure markets that the Federal Reserve remains vigilant, prepared to adjust rates as needed, and committed to harnessing emerging technologies for economic stability. AP News contributed to the report with Josh Embry and Elliott Hawkes; AP Photo by Dhitaraht Dhanarahtsombat.