Federal Reserve Speeches·Nov 10, 2026, 3:30 PM ET

Bowman, The U.S. Economy and Considerations for Monetary Policy

U.S. economic growth accelerated to over 3 percent in the third quarter, driven by robust AI-related capital expenditures & solid consumer spending.
The unemployment rate edged down to 4.1 percent in October, though labor market dynamism remains low with low hiring & firing rates.
Core PCE inflation likely rose to 3.3 percent in October, driven by energy prices, tariffs, & AI-related demand pressures that have broadened.
The Federal Reserve held the federal funds rate target range at 3.75 to 4 percent at the October meeting to await clearer data on inflation trends.
Persistent inflation is attributed to external shocks including tariffs, Middle East geopolitical tensions, & supply constraints in the AI buildout.
Energy prices surged above $110 per barrel due to Middle East conflict disruptions but have recently retraced as crude flows recovered.
AI investment has boomed with real business fixed investment growing at a pace similar to the 1990s tech boom, though AI revenues remain insufficient to cover costs.
AI-related corporate debt is projected to exceed $800 billion this year, accompanied by complex off-balance-sheet financing structures creating counterparty risks.
Financial conditions have tightened recently due to lower equity prices, higher private interest rates, & a stronger dollar.
The Fed views inflation as the primary risk to its dual mandate, as the labor market has improved while price stability goals remain unmet.
Future monetary policy will depend on the durability of AI demand, the resolution of geopolitical conflicts, & the evolution of financial market volatility.
Policymakers expect core PCE inflation to return closer to the 2 percent target next year as temporary supply shocks wane.