Fed's Goolsbee: We have a pretty significant inflation problem, but job market is stable

It is my great pleasure to be at the 389th Cutler’s Feast. It is exactly 30 years since Eddie George made the last Governor’s speech at the Feast. Master, the Company had a 70 year start on the Bank of England. We are a mere youngster. From your founding in 1624, the company was the regulator of the cutlery trades in Hallamshire. The growth of the trade led to disputes over flouting of the company’s rules, including going into partnership with foreigners. Was this people outside Yorkshire? Senior Warden, you talked about the need for economic growth. I am going to join you on that subject. The title of my speech this evening is “Can AI make Cutlery”? Let me start with a few key facts on growth. For around fifteen years before the Financial Crisis (1990-2006), the average annual rate of growth of potential supply in the UK economy was around 2.8%. Productivity contributed 2.4pp and labour supply 0.4pp. For the roughly fifteen years since the Financial Crisis, the potential growth rate has fallen to 1.3% pa, of which productivity contributed 0.4pp and labour supply 0.8pp. The comparable figures for actual growth – the growth of demand – are 2.4% and 1.3% . This has had a direct effect on living standards. In t BoE Gov. Bailey: AI boost to productivity numbers could take time, how long is an open question. BANK OF ENGLAND GOVERNOR ANDREW BAILEY DOES NOT REFER TO CURRENT MONETARY POLICY IN PREPARED REMARKS TO BE DELIVERED AT CUTLER'S FEAST #bankofengland #boe #ukeconomy #monetarypolicy #andrewbailey

Trump: We're negotiating on Iran, we'll get it one way or the other. TRUMP: US BLOCKADE IN HORMUZ IS 100% EFFECTIVE || TRUMP: WE HAVE NEW ANTI-DRONE TECH WE DIDN'T HAVE 2 MONTHS AGO TRUMP: HAVE GREAT DRONE TECHNOLOGY TO KNOCK IRAN DOWN || WANT HORMUZ OPEN, FREE, NO TOLLS TRUMP: IRAN CANNOT KEEP THEIR HIGHLY ENRICHED URANIUM. ONCE WE GET IT WE WILL PROBABLY DESTROY IT. WE DON'T WANT IT

Thank you for that kind introduction, and for inviting me to join you today. I'd like to share my perspectives on the U.S. economy — where we are now, and whether we are sailing toward calmer seas or into more turbulent waters. These are my thoughts alone and not those of anyone else on the Federal Open Market Committee or in the Federal Reserve System. Over the last several years, the U.S. economy has faced wave after wave of supply shocks. Every time one wave recedes, we’re hit with another: the COVID-19 pandemic, the Russian invasion of Ukraine, the collapse of Silicon Valley Bank, the tariff tumult, and most recently, the conflict in the Middle East. We’ve seen smaller ripples, too: a ship lodged in a major trade route, bird flu, factory fires, government shutdowns, ice storms and more. These shocks affect the available supply of goods and services: too little energy, no chips for cars, tighter credit, not enough wheat. After the pandemic, we even saw supply challenges with labor. Typically, these shocks result in higher prices for a time and, in turn, a pullback in demand. Let me focus on the latest wave: the conflict in the Middle East. While it’s rocked the boat, it’s done so less than one might have imagined. We’ve all seen the price jump at the gas pump. I’m also hearing of fuel surcharges, rising airfares, freight and packaging costs, as well as availability issues with key inputs like fertilizer and aluminum. We can see these higher costs — especially energy — in the recent inflation data. Headline PCE jumped up to 3.5 percent year–over–year in March 2026. Core inflation, which excludes food and energy, increased more modestly to 3.2 percent. The impact is much less noticeable in demand. Consumer spending is up, and not just due to ever more expensive gasoline. Non-gas spending growth has remained solid, too. Corporate profits are high. Artificial intelligence (AI) investment contin RICHMOND FED'S BARKIN/RALEIGH: 'WOULDN'T BE SURPRISED 'TO SEE ADDITIONAL PRESSURE ON JOBS OR INFLATION 'OR CONCEIVABLY BOTH' RICHMOND FED'S BARKIN/RALEIGH: 'WOULDN'T BE SURPRISED 'TO SEE ADDITIONAL PRESSURE ON JOBS OR INFLATION 'OR CONCEIVABLY BOTH' Fed's Barkin: The policy of looking through supply shocks has worked well in the past, but it is easy to see more challenging conditions and more frequent shocks in the future.