"Unlike typical investment patterns, AI spending hasn't fallen despite Federal Reserve rate hikes because, Sløk noted, datacenter investment is ultimately financed by rising equity valuations of the "Magnificent Seven" including Microsoft, Amazon, Alphabet, and Nvidia. Analyst firm Omdia estimates that global datacenter capex will top $657 billion in 2025, almost double the figure of just two years ago, with the US dominating. Amazon's annual datacenter spending alone exceeds $100 billion, roughly Costa Rica's entire GDP."
"Jason Furman, Economist and former Deputy Director of the US National Economic Council, estimated in a New York Times podcast that 92 percent of the economic demand in the first two quarters of this year came from information processing equipment and software. "Ultimately, what we're really hoping for is that AI shows up on the supply side of the economy, actually helping us do more with less," he said. Some of that is happening, he claimed, "but there hasn't been anything particularly special about productivity growth to date.""
AI spending is sustaining US growth by driving datacenter infrastructure and model development, offsetting the slowdown from higher interest rates and disruptive trade policies. Datacenter investment and AI development are the primary sources of corporate capital expenditure growth while other capex remains weak. Rising equity valuations of major tech firms finance continued datacenter projects despite Federal Reserve rate hikes. Global datacenter capex is projected to surge, led by the US and massive corporate spenders. Information processing equipment and software drove a large share of recent demand. Productivity gains from AI remain limited and returns are uncertain.
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