Federal Reserve Governor Lisa Cook stated that the surge in AI-related capital spending may create inflationary pressure. This concern is expected to remain a key focus for the central bank as it approaches 2027.
Companies have announced approximately $2 trillion in AI investment plans, primarily for data centers, though only a small portion of these funds has been deployed. Costs for essential inputs, such as electricity, have increased by about 5% over the past year.
Cook noted that while AI may eventually drive productivity gains and modest disinflation, these benefits are unlikely to offset immediate inflationary pressures through late 2026. Supply bottlenecks and uncertainty regarding the timing of productivity relief are the primary factors behind this outlook.
During a discussion on October 1, 2026, with New York Fed President John Williams, Cook emphasized that 2027 could be the year when these inflationary effects become significant. She noted that sectors such as utilities, construction, and hardware are most affected by these cost pressures.
The Federal Reserve does not intend to use monetary policy to target inflation in specific sectors, as Cook believes the central bank's tools are not precise enough for such interventions. The main concern remains whether AI-related cost increases will impact broader inflation.
