Federal Reserve Chair Kevin Warsh is keeping an eye on artificial intelligence and what impact the burgeoning industry could have on the overall economy.
On Friday, in a wide-ranging speech in Jackson Hole, Wyoming, Warsh said AI opens up "some major lines of inquiry, such as whether token use will be competitive or complementary to labor and what the broader implications may be for workers.
"The Fed watches all of this attentively," Warsh said. "We recognize that AI is a new variable-potentially a new factor of production-that will have consequences for both the economy and the conduct of monetary policy."
Friday's comments offer a more detailed look at how Warsh views AI. In July, Warsh said the central bank did not yet know the "extent to which the economy will benefit from the AI buildout." His latest comments, however, provide a clearer picture of how the Fed plans to study the technology’s effects.
Warsh said the Fed will examine AI’s impact on productivity and jobs through its task force. One of his first actions as Fed chair was to create a Productivity and Jobs Task Force, among others that are tasked with assessing the impact AI and other technologies will have on the economy.
"To be clear, though, their recommendations will come later and have no bearing on decisions we make in the current policy conjuncture," Warsh said on Friday. "But I believe that for future policy challenges, this intellectual investment today will leave us far better prepared."