Federal Reserve’s Barkin says economic fog has deepened amid AI and Iran conflict in World Economy News 28/03/2026 Federal Reserve Bank of Richmond President Tom Barkin said Friday that economic uncertainty has intensified over the past year, with artificial intelligence developments and the Iran conflict creating what he described as deepening fog for policymakers and businesses. Speaking at the Appalachian Highlands Economic Forum at East Tennessee State University in Johnson City, Tennessee, Barkin said that while many policy questions from last year have been resolved, new sources of uncertainty have emerged. He noted that AI capabilities are advancing dramatically, with Block announcing plans to replace 40% of its workforce with AI and nearly $700 billion in AI investments outlined in one week. The Iran conflict has added another layer of uncertainty, causing oil prices to spike and supply chains to be disrupted, Barkin said. He pointed out that oil price shocks have historically coincided with recessions in 1974, 1979, and 1990. Despite the uncertainty, the economy grew at 2% last year, with consumers continuing to spend based on recent credit card data. Barkin attributed this to low unemployment, rising real wages, and elevated asset values. Business earnings were up double digits in the fourth quarter. The unemployment rate has hovered around 4.4% over the past six months, a level only reached three times in recent decades. However, employment growth is near zero, with younger workers struggling to find jobs. Barkin explained that low hiring is being offset by reduced net migration and baby boomers leaving the workforce. Inflation remains nearly a percentage point above the Fed’s 2% target, though it has declined from over 7% in 2022. Barkin said shelter price growth has come down and wage pressure has eased, but recent PCE inflation data suggests progress may be stalling. On the labor market, Barkin said employers report that labor is freely available with multiple applicants for every position, and they face little wage pressure. Turnover is low, and employers remain reluctant to hire given strong productivity, high uncertainty, and AI’s potential impact. Regarding AI’s employment effects, Barkin said most current discussion focuses on job losses, but he sees potential for revenue and employment growth through better sales targeting and expansion opportunities, provided skills mismatches can be addressed. The Fed has lowered rates 175 basis points over the past 18 months, leaving the fed funds rate at the higher end of the neutral range. At the most recent meeting, with risks to both the labor market and inflation, the Fed held rates to await more clarity, Barkin said. Source: Investing.com 2026-03-28 hellenicshippingnews... window.___gcfg = {lang: 'en-US'}; (function(w, d, s) { function go(){ var js, fjs = d.getElementsByTagName(s)[0], load = function(url, id) { if (d.getElementById(id)) {return;} js = d.createElement(s); js.src = url; js.id = id; fjs.parentNode.insertBefore(js, fjs); }; load('//connect.facebook.net/en/all.js#xfbml=1', 'fbjssdk'); load('https://apis.google.com/js/plusone.js', 'gplus1js'); load('//platform.twitter.com/widgets.js', 'tweetjs'); } if (w.addEventListener) { w.addEventListener("load", go, false); } else if (w.attachEvent) { w.attachEvent("onload",go); } }(window, document, 'script')); tweet Share