Jefferson, New Technology, Old Questions: Productivity Puzzles and the Macroeconomy

AI desk brief

Fed Vice Chair Jefferson said inflation would be the more important policy signal after supporting October’s rate hold; September 2026 headline and core PCE inflation were 3.6% and 3.1%. He cited persistent energy and technology-input pressures, alongside solid activity and October unemployment of 4.1%. Continued inflation persistence could delay easing and weigh on gold if expected real yields rise, although longer-term inflation expectations remained stable. Jefferson expects AI productivity gains to emerge gradually and potentially raise the neutral rate, but stressed uncertainty over their timing and magnitude. His views do not necessarily represent the FOMC.