The AI ​​arms race could hide an inflationary shock

Investments in artificial intelligence and especially hyperscaler investments are very important for inflation, interest rates and asset prices. It could be that the wave of deflation that many expected will not occur.

In fact, it could be quite inflationary. To the extent that AI helps increase productivity, or output per hour of work, while de-intermediating large swaths of the workforce, it could, many argue, be disinflationary in the long run.

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