A sharp rise in US artificial intelligence (AI) investment is expected to support global economic growth, with benefits flowing through supply chains across Asia and North America.
The investment boom is playing a growing role in supporting the US economy, CBA Head of Foreign Exchange, International & Geoeconomics Joe Capurso said.
“The AI capital spending boom was the quiet achiever of 2025,” he said, saying the spending will accelerate in 2026.
Spending by major US technology firms continues accelerating rapidly, with investment by “hyper-scalers” – the companies that provide the data centres and computing power behind the AI revolution - expected to rise to around US$740 billion in 2026 and continue increasing.
Capurso said the uplift is expected to translate into stronger economic growth numbers, with AI investment forecast to add around half a percentage point to US economic growth and around a quarter of a percentage point globally in 2026, with the current investment wave marking a significant shift from previous technology cycles.
“Compared to the dot.com era, today’s AI boom is larger, more hardware-intensive, and more globally integrated,” he said.
Global supply chains drive widespread gains
Samara Hammoud, International Economist and Currency Strategist at CBA, said the benefits of this investment extend beyond the US, reflecting the global nature of AI production.
“We estimate 58 per cent of US hyper-scalers’ AI capex will be provided by other economies,” she said.
Hammoud said the estimate highlighted the scale of international supply chains supporting AI infrastructure, with electronics manufacturing a major contributor to the additional activity.
“Electronics manufacturing gains one-third of the extra economic activity,” she said.
Hammoud said the overall investment picture becomes even larger when upstream industries are included, with global AI spending approaching US$1 trillion in 2026.
“The global AI commitment is closer to $US1tn in 2026, or 1 per cent of global economic activity,” she said.
The surge in investment is also helping offset broader global economic pressures, including energy supply disruptions caused by the Middle East conflict, highlighting AI’s growing role in supporting economic activity.
Implications for inflation and interest rates
While the AI boom is supporting growth, Capurso said stronger demand linked to AI investment is also contributing to inflation pressure in the US, with a combination of firm demand, tax settings and labour market conditions strengthening the case for higher interest rates.
“We consider the stars are aligning for the Federal Reserve to start an interest rate hiking cycle in December 2026,” Capurso said.
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