Productivity Rises 1.4%, Goolsbee Warns on AI Interest Rates

U.S. non-farm labor productivity increased at an annual rate of 1.4% in the second quarter of 2026 compared to the previous quarter. Austan Goolsbee, president of the Chicago Federal Reserve Bank, warned that if expectations for AI productivity outpace actual indicators, it could lead to inflation and interest rate pressures. He mentioned at a conference in Tokyo, Japan, that the expectation of productivity improvements could accelerate consumption and investment, indicating that increased spending might lead to economic overheating. In the second quarter, unit labor costs in the non-farm sector rose by 1.3%, and hourly compensation increased by 2.7%. President Goolsbee assessed that the impact of AI on productivity improvements is limited, explaining that if the market reflects AI expectations, interest rate pressures could arise. The central bank's policy judgments may become more challenging, and if AI investments boost short-term demand, inflation pressures could persist. The BLS is set to release revised productivity and cost figures on September 3 at 9:30 PM.

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