What effects on the economy can result from the use of modern technologies such as artificial intelligence and automation in the monetary policy of the central bank, especially in the field of inflation forecasting and interest rate management?

This question concerns the impact of technology on monetary policy decision-making. Technologies such as artificial intelligence and automation can revolutionise the way central banks forecast inflation, make interest rate decisions and monitor economic conditions. The use of such tools can improve the accuracy of decisions, but at the same time, it can also bring new challenges and risks. It is possible that the use of modern technologies, such as artificial intelligence, in monetary policy can improve the effectiveness of inflation forecasting and interest rate management, while minimising human error and increasing the speed of response to changes in the economy. Therefore, the use of technologies such as artificial intelligence in monetary policy can contribute to more precise forecasting of inflation trends and faster interest rate decisions. AI can analyse huge data sets, including macroeconomic and market data as well as information from the media, enabling central banks to respond more quickly to changes in the economy. However, there are also concerns about the independence of decisions made by machines, as well as risks associated with algorithmic errors. It is therefore necessary to understand and control the risks associated with automated decisions in such a crucial area as monetary policy, and to ensure that the technology is properly integrated with traditional methods of economic analysis.

My following articles are related to the above issues in some aspects:

I have described the key issues of opportunities and threats to the development of artificial intelligence technologies in my article below:

OPPORTUNITIES AND THREATS TO THE DEVELOPMENT OF ARTIFICIAL INTELLIGENCE APPLICATIONS AND THE NEED FOR NORMATIVE REGULATION OF THIS DEVELOPMENT

Article OPPORTUNITIES AND THREATS TO THE DEVELOPMENT OF ARTIFICIAL I...

I have written about the sources of the high inflation that has occurred since 2021 as a result of the Covid-19 pandemic in the following article based on my research:

THE POST-COVID RISE IN INFLATION: COINCIDENCE OR THE RESULT OF MISGUIDED, EXCESSIVELY INTERVENTIONIST AND MONETARIST ECONOMIC POLICIES

Article THE POSTCOVID RISE IN INFLATION: COINCIDENCE OR THE RESULT O...

I have described the key aspects of the monetary policy pursued by central banks in recent years in the following article:

Comparisons of the monetary policy of the central banks of the Federal Reserve Bank and the European Central Bank and the National Bank of Poland

Chapter Comparisons of the monetary policy of the central banks of t...

Analysis of the effects of post-2008 anti-crisis mild monetary policy of the Federal Reserve Bank and the European Central Bank

Article Analysis of the effects of post-2008 anti-crisis mild moneta...

Synergy of post-2008 Anti-Crisis Policy of the Mild Monetary Policy of the Federal Reserve Bank and the European Central Bank

Article Synergy of post-2008 Anti-Crisis Policy of the Mild Monetary...

ACTIVATING INTERVENTIONIST MONETARY POLICY OF THE EUROPEAN CENTRAL BANK IN THE CONTEXT OF THE SECURITY OF THE EUROPEAN FINANCIAL SYSTEM

Article ACTIVATING INTERVENTIONIST MONETARY POLICY OF THE EUROPEAN C...

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I invite everyone to the discussion,

Thank you very much,

Best wishes,

I invite you to scientific cooperation,

Dariusz Prokopowicz