San Francisco Fed President DALY said further Fed tightening may be necessary to
reduce inf, noting persistent price pressures that are not confined to
industries directly affected by tariffs or oil. She said an increasing number of
firms report plans to pass higher input costs to consumers and that pricing
willingness is strengthening. DALY said she supports a September rate hike and
holding policy unchanged in October. On AI, she said AI infrastructure is
raising prices in some areas but its overall effect on inf is so far modest and
not broad-based; she expects AI to boost productivity over the long run but the
timing is uncertain. DALY is not an FOMC voter this year.
