A surge in corporate spending on artificial intelligence is pushing up consumer prices, complicating efforts to tame inflation. While July’s CPI rose 3.4% year over year, prices for information-technology commodities jumped 1.4% from June as demand for chips and storage climbed and manufacturers passed higher costs to shoppers. “We are in the midst of a huge AI-related buildout,” said BofA Securities economist Stephen Juneau, noting businesses are competing with consumers for the same components. Rising electricity costs tied to energy-hungry data centers are adding to the burden, with power up 4.2% from a year earlier. Oxford Economics expects AI-driven price pressures to persist for at least two years, though many economists see longer-run disinflation as productivity gains from AI take hold.
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