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flag Fed's Barr says rate cuts unlikely without clearer goods inflation drops, despite stable jobs and AI advances.

flag Federal Reserve Governor Michael Barr said on February 17, 2026, that further interest rate cuts are unlikely without clear evidence of sustained declines in goods price inflation, despite a stable labor market. flag He emphasized ongoing risks from inflation above the 2% target and warned of potential labor market disruptions from rapid AI adoption, though overall employment remains resilient. flag Barr noted AI’s long-term productivity benefits but stressed it won’t justify lower rates, as investment in AI is driven more by competition than interest rates. flag The Fed is maintaining a cautious stance, awaiting more data before adjusting policy.

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