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Fed Governor: AI May Deflate Costs, Boost Dollar

2/21/2026

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Story summary
  • Federal Reserve Board Governor Stephen Milan emphasized that forecasts matter more than historical data.
  • He noted that AI could exert deflationary pressure by lowering production costs.
  • Milan expressed optimism about inflation prospects and the U.S. dollar's stability.
  • He noted the need for regulatory adjustments in balance sheet management and praised Kevin Warsh, Trump's nominee for Fed Chair, for his expertise in monetary policy and balance sheet management.