Former New York Federal Reserve President: Current reasons for interest rate cuts are weak. Neutral interest rates may be higher than the Fed's assumptions

On May 27, former New York Fed President Bill Dudley warned that the Fed's credibility as an "anti-inflation" defender was shaky after a long period of failure to achieve the 2% inflation target. He believes that neutral interest rates may be structurally higher than the Fed's current assumptions, due to factors including an artificial intelligence-driven investment boom and rising U.S. government debt levels.