Will AI Lower Interest Rates?

The rapid development of artificial intelligence (AI) technologies has been creating significant impacts on the economy and finance world. Especially, the role of AI in determining interest rates has been a topic of intense interest among economists and policymakers. In this context, it is essential to analyze how the experiences and predictions of Alan Greenspan, the former chairman of the Federal Reserve, in the 1990s have been reevaluated through AI. Greenspan, based on his experiences and predictions, argued that an IT-driven productivity boom was already forming in the economy, and therefore, inflation would not rise. This approach led Greenspan to prefer lower interest rates, despite many economists advocating for higher interest rates at the time. However, with the development of AI technologies, it has become possible to predict changes in the economy more quickly and accurately. This situation allows for more accurate and long-term decisions to be made in determining interest rates. Therefore, can the development of AI technologies lead to lower interest rates? To answer this question, it is necessary to analyze the relationship between AI and economy more deeply. Especially, the effects of AI technologies on productivity and output can play a significant role in determining interest rates. However, the development of AI technologies also creates new risks and uncertainties. Therefore, in determining interest rates, the effects of AI technologies should be carefully evaluated, and economic stability should be prioritized. Finally, the effects of AI technologies on interest rates can play a significant role in achieving economic growth and stability. However, accurately predicting and evaluating these effects is a significant responsibility for economists and policymakers. Therefore, the development of AI technologies will continue to create new opportunities and challenges in determining interest rates.