Fed

New York Fed President John Williams publicly stated that supply chain bottlenecks driven by AI infrastructure investment are expected to persist for more than two years and pose structural upward pressure on inflation. He reaffirmed the Fed may still need to raise interest rates once more this year to maintain price stability.

Federal Reserve Chair Jerome Powell issued a rare warning that the Fed’s credibility is at risk, suggesting that political pressure is threatening the central bank’s independence. His reference to “stress tests” was interpreted as a response to executive interference in monetary policy. The statement has drawn market attention as it may signal unprecedented external pressure on the Fed’s rate-setting process.