Anna Paulson on productivity
From Remarks from Philadelphia Fed Pres. & CEO Anna Paulson at the Macroecon & Monetary Policy Conference · · Federal Reserve Bank of San Francisco
“Different scenarios about long run productivity growth have implications for monetary policy through what they imply about the long run Fed funds rate. When productivity growth is higher, there are more investment opportunities and stronger demand for capital. And this puts upward pressure on interest rates.”
On , Anna Paulson, President at The Federal Reserve Bank of Philadelphia, spoke about productivity during Remarks from Philadelphia Fed Pres. & CEO Anna Paulson at the Macroecon & Monetary Policy Conference on Federal Reserve Bank of San Francisco.
About Anna Paulson
Anna Paulson, President and CEO of the Federal Reserve Bank of Philadelphia, delivered remarks at the Macroeconomics and Monetary Policy Conference in San Francisco on March 27, 2026. She discussed the importance of the conference in connecting researchers and policymakers, describing research and debate as "the foundation of everything we do at the Federal Reserve" and central to evidence-based policymaking. Paulson stated that the key priority for monetary policy is "to deliver on stable prices and maximum sustainable employment," adding that achieving 2% inflation while keeping unemployment low creates benefits and credibility. Paulson offered several observations on monetary policy and economic scenarios. She said her current estimate of the longer-run neutral rate of interest (RSTAR) is "close to the SEP median of 3.1%," but noted it could be revised up or down with more data. She commented that different scenarios for long-run productivity growth have implications for the long-run federal funds rate, as higher productivity growth creates more investment opportunities and upward pressure on interest rates. Paulson also contrasted policy approaches based on inflation conditions: if inflation were at the 2% target, she said she would feel comfortable being patient and keeping policy on hold, but if inflation is above 2%, she would be more cautious and "inclined to weight the possibility of overheating more heavily." She referenced the Federal Open Market Committee's credibility earned during the Volcker era, noting that it gave the committee room to be patient during the Greenspan period even when growth ran above conventional models.