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Fed's Jefferson says AI is speeding investors' reactions to central bankers' messages

"For now, I do not think artificial intelligence is changing the way policymakers communicate, but research shows that it has affected how quickly information about policy is incorporated into asset prices," Jefferson said in prepared remarks to a conference at the San Francisco Fed that did not touch on his outlook for monetary policy or the U.S. economy. Further research is needed, he said, to determine whether the faster speed is allowing monetary policy to get transmitted faster through the economy, or, as some worry, that it "may provide an incentive for investors to value speed over accuracy, and may reduce the long-run informativeness of asset prices, which could hurt the transmission of monetary policy."

Stock markets may face correction, says Goldman Sachs

Wall Street stocks could be facing a correction because of ructions in the options market, Goldman Sachs specialist Scott Rubner said in a Thursday note seen by Reuters on Friday. Roughly $2.7 trillion of U.S. stock market derivatives are due to expire on Friday, which if not exercised, will put pressure on stock markets and stoke volatility, the note said. S&P 500 and European stock markets hit a record highs on Tuesday but have since declined amid Trump's latest tariff warning on pharmaceuticals, semiconductor chips and wood, which among other threats, has exacerbated fears of a broad trade war and unnerved investors.