Federal Reserve Chair Kevin Warsh said on October 28, 2026, that the US economy was not running too hot despite demand pressures from an artificial intelligence investment boom. He spoke after the Fed rate decision to leave interest rates unchanged.

Key Takeaways

  • Warsh said most of his colleagues did not judge the economy to be running too strong.
  • He said productivity had improved, although the change was difficult to measure precisely.
  • Warsh said politics played no role in the decision to hold rates before the US midterm elections.

Fed rate decision and the AI investment boom

Warsh said the economy was pointing in the right direction and that the Fed’s goal was not to impede economic growth. He did not believe growth itself was fueling inflation or making the central bank’s job more difficult.

The Fed’s October 27–28 meeting page includes links to the meeting statement and implementation note. Warsh spoke at a news conference after the decision.

Productivity and political considerations

Warsh said estimating the economy’s potential growth rate remained difficult. In his judgment, productivity had improved, with much of the change preceding discussion of superintelligence, although he cautioned that productivity gains could not be measured precisely.

Asked about the approaching midterm elections, Warsh said politics played no role in the Federal Open Market Committee’s deliberations. He said he heard no references to politics or the elections during the committee’s two days of meetings.

Warsh addresses Cook investigation

Warsh also said that, to his knowledge, he would not be involved in a White House investigation into Federal Reserve Governor Lisa Cook over alleged misstatements on mortgage applications.

The allegations are part of President Donald Trump’s efforts to remove Cook, who sued to retain her position. A three-member committee convened by Trump is investigating and is to hold a hearing on any evidence gathered.

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