**[Federal Reserve's Cook: AI Sparks Major Changes, Neutral Rate May Rise in the Short Term]** Odaily Planet Daily News – Federal Reserve Governor Cook stated that artificial intelligence has triggered generational shifts in the U.S. labor market and may lead to an increase in unemployment, a situation the Fed might not be able to address through rate cuts. While AI will bring new opportunities, in its early stages, job displacement may precede job creation. Consequently, as the economy undergoes transformation, unemployment rates may rise, and labor force participation may decline. In such circumstances, even if productivity improves, structural factors driving up the natural rate of unemployment could make any Fed response risk inflation. She also pointed out other "profound" challenges facing monetary policy, including the AI investment boom potentially pushing up the neutral rate in the short term. All else being equal, this could necessitate tighter monetary policy. However, if the emerging AI economy exacerbates income inequality or concentrates the benefits of technological advancements among wealthier groups, the neutral rate may decline over time. (Jin10)