Are AI investments fuelling inflation? Fed Chair Kevin Warsh flags risk in testimony to congress

Do investments in AI contribute to inflation? The answer is increasingly in the affirmative, according to Federal Reserve Chair Kevin Warsh. In his testimony before the House Finance Committee on Tuesday, Warsh identified the AI investment boom as a new and significant source of price pressure, citing the quick development of data centers and the rising demand for AI software and equipment as “the most striking feature” of the US economy at the moment.