Fed's Paulson says the September inflation numbers drove the rate hike

• The labour market is stable.
• The economy is resilient and showing signs of increased momentum.
• Underlying inflation remains stubbornly high.
• AI buildout is helping drive inflation pressures.
• Balance of inflation risks shifted ahead of the September policy meeting.
• Best you can say about inflation is that it has not got worse.
• She will support doing what is needed to get inflation back to 2%.
• The September rate hike helped move policy to a better inflation-fighting posture.
• US central bank may need to raise interest rates again to lower inflation.

A single official attributing a past rate move to a specific data print is a familiar piece of post-decision framing: it tells the market which release the reaction function is keyed to, and by extension which upcoming prints carry the most repricing risk for the front end. The more consequential line is the explicit openness to another hike, since conditional language of that kind from a sitting official has historically mattered less for its own content than for whether it is echoed by colleagues, the pattern being that lone hawks shift pricing at the margin while a converging chorus shifts the median. The argument that AI-related investment is adding to inflation pressure is a relatively novel channel in official rhetoric, worth noting because it frames a supply-side, investment-driven impulse rather than the usual demand or shelter story, and officials who adopt that framing have tended to stay hawkish longer since the impulse is not one policy directly suppresses. The characterisation of the labour market as stable alongside stubborn underlying inflation is the standard justification for restrictive-for-longer, and it raises the sensitivity of the next inflation releases relative to employment data. The tells are whether other officials adopt the same data-attribution and whether the remarks survive contact with the next print.