[St. Louis Fed President Discusses Bond Market Turmoil, Says Market Does Not Doubt Fed's Credibility] According to a report by Jinse Finance, on August 21, St. Louis Federal Reserve President Alberto Musalem stated that the sell-off in the U.S. bond market is driven by increased government borrowing and financing needs related to artificial intelligence development, rather than doubts about the Federal Reserve's credibility. “There is currently competition for funds, stemming from government financing—total government financing—combined with artificial intelligence development, which is being financed both in the U.S. and globally,” Musalem said on Thursday. “Interestingly, inflation expectations remain anchored. The Federal Reserve's credibility has not been called into question.” When investors doubt the Fed's resolve to curb inflation, bond yields may also rise. The St. Louis Fed President, who does not have a monetary policy voting role this year, reiterated that he had hoped the Fed would raise interest rates at the July meeting to curb persistently high inflation. He believes that without raising rates, the likelihood of inflation not falling back to the Fed's 2% target within 18 months increases.