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AI boom creates analytical challenge for central banks as surging spending meets import offsets

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As massive investments in artificial intelligence continue unabated, the contribution of these outlays to the US economy and their precise impact on productivity remain subjects of intense debate.

The AI boom is heavily reliant on huge imports of hardware that the United States does not manufacture domestically.

This dynamic creates an unusual disconnect between the sheer scale of investment activity and the way it is reflected in official statistical releases, particularly GDP.

In this context, not all capital expenditures are reflected equally in GDP metrics. The construction of AI infrastructure relies heavily on imported semiconductor chips, servers, and networking hardware.

Consequently, a significant portion of the investment surge is offset in government growth calculations.

Artificial intelligence does not possess its own distinct, comprehensive category within official statistical frameworks. This obliges economists to infer its contributions from baseline investment and trade classifications.

In a paper published this month, Federal Reserve economists Paul Soto, Mason Thieu, and Jeffrey Allen wrote:

“The lack of a dedicated category for AI-related investment in national accounts, combined with the high import content of the equipment driving infrastructure buildouts, presents a heightened challenge in precisely measuring how much recent GDP growth has been powered by AI-related capital spending.”

The US economy expanded at an annualized rate of 2.1% in the first quarter. Federal Reserve economists estimate that AI expenditures—comprising capital outlays in software, data centers, energy infrastructure, and computing hardware—contributed approximately 0.73 percentage points to GDP growth.

However, the estimated contribution of AI investments would have been substantially larger were it not for the counterbalancing drag generated by imported AI components.

Net imports of computers, peripheral equipment, and components alone subtracted 0.45 percentage points from headline growth.

US AI import shares expand papidly

According to research by Minneapolis Fed economist Michael Waugh, AI-related products accounted for 23% of total US imports in 2025, up from 15% in 2023.

Computer hardware constitutes roughly half of these incoming shipments.

The remainder consists of electrical equipment, networking hardware, and cooling systems essential to building and operating AI data centers.

The Trump administration largely exempted many of these AI-related inputs from broad-based tariffs.

The interplay between AI capital outlays and trade dynamics was particularly pronounced in late 2025. Corporate entities funneled enormous capital into AI hardware during the final three months of the year, but once imports were factored into the equation, the net boost to GDP was largely erased.

Federal Reserve economists noted that the net impact of AI investments “varied significantly across quarters, as sharp import spikes in certain periods produced a negative contribution from net exports of computers, peripherals, and parts that offset the bulk of gross capital expenditure.”

Net imports exert drag on headline growth

Federal Reserve economists estimate that AI infrastructure investments added just 0.14 percentage points to GDP, even though top-line expenditures in relevant categories contributed roughly 0.75 percentage points prior to accounting for trade flows.

Net imports of AI equipment reduced overall GDP growth by 0.61 percentage points over the period.

Economists project that the economy expanded at an annualized rate of 1.8% during the April-June quarter. The official report will be released today (July 30).

Goldman Sachs anticipates a rebound in consumer spending alongside continued strength in corporate capital outlays driven by AI equipment expenditures.

The AI expansion is simultaneously forcing economists to re-examine traditional methodologies for measuring the broader economy.

Because growth is increasingly anchored in imported hardware and intangible software assets, conventional indicators of broader economic activity are becoming harder to interpret.

The productivity question: Capital utilization over AI adoption

Artificial intelligence appears to be enhancing worker productivity across a range of industries, and the US economy as a whole has recorded a notable productivity gain over the past few years.

However, it is far from certain that the former is directly driving the latter. A controversial new analysis indicates that companies are extracting more hourly output per worker not through widespread AI adoption—at least for now—but through more efficient utilization of existing capital assets.

According to Ernie Tedeschi, chief economist at Stripe, AI advancements may be yielding meaningful micro-level gains in specific sectors, but they have not served as the primary catalyst behind one of the most significant macroeconomic trends of recent years.

After decades of sub-par gains, the recent acceleration in labor productivity has stood out as one of the most positive developments for the US economy over the past few years.

Tedeschi noted that output per hour worked increased by 2.5% over the past year, compared to an average annual growth rate of 1.6% over the preceding two decades.

While that difference might appear modest, if sustained over even a few years, it compounds into a powerful effect, driving per-worker income and output to substantially higher levels.

However, Tedeschi found that while labor productivity has risen, total factor productivity—which measures output per unit of combined labor and capital inputs—remained virtually unchanged.

Examining performance across sectors, he observed that industries with high AI adoption did exhibit higher productivity growth, but that trend actually predated the pandemic—well before advanced large language models (LLMs) entered widespread commercial deployment.

Instead, Tedeschi concluded that higher output has been driven by more intensive and efficient utilization of existing capital stock.

Tedeschi wrote:

“Consider factories already built running longer hours, fully amortized server racks and GPU clusters being driven harder, or existing hotel rooms achieving higher occupancy rates. Economists refer to this as ‘capital intensity’ or ‘utilization rate.’ Higher capital utilization represents real economic gains, but it is fundamentally distinct from micro-level technological efficiency.”

In statements to Axios, Tedeschi said the US is in a period of elevated productivity growth and that it is increasingly plausible AI plays a role, but added a note of caution:

“We must remain realistic about how AI fits into this process, because doing so helps us discern whether AI represents a temporary fluctuation along the growth trajectory or a more permanent, transformative shift.”

AI boom complicates central bank strategy

While central bankers operate under mandates to preserve price stability, foster full employment, and maintain financial stability, the AI boom introduces fresh complexity across all three domains.

A report by the Bank for International Settlements (BIS) indicates that AI is blurring the traditional signals central bankers rely on to formulate monetary policy.

According to the BIS, the technology is simultaneously influencing both the supply and demand sides of the economy, triggering structural and cyclical shifts at the same time.

In the United States and other primary hubs of AI innovation, the near-term investment surge has sparked sharp demand for semiconductors and data center infrastructure components.

Concurrently, the stock market rally has inflated paper wealth, further stoking consumer demand. However, concerns persist that a portion of this market valuation may be illusory, raising fears of an AI asset bubble that could eventually burst.

While AI presents a medium-term risk of large-scale labor displacement, empirical evidence that this process has begun remains inconclusive.

Conversely, a scenario in which AI advances unlock substantial productivity gains would represent a favorable supply shock, which would typically be expected to exert downward pressure on inflation.

BIS economists Iñaki Aldasoro, Leonardo Gambacorta, Enisse Kharroubi, and Matthias Rottner wrote:

“The vast uncertainty surrounding the ultimate impact of AI presents distinct challenges for monetary policy and financial stability. First, AI simultaneously impacts demand and supply from both cyclical and structural perspectives. Moreover, these effects vary widely across individual sectors, complicating any assessment of underlying economic trends. Elevated uncertainty heightens the risk of policy missteps.”

Central banks—including the Federal Reserve, which concludes its policy meeting today, as well as the Bank of England and the Bank of Japan, both scheduled to meet tomorrow—are forced to make real-time interest rate decisions based on limited clarity regarding the direction, magnitude, and timeframe of the AI boom’s macroeconomic impact.

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Over half of Latino voters back Democrats in key US House races

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09/09/2026

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A new public opinion poll in the US shows that Democratic candidates have made notable gains since 2024 among Latino voters in critical, competitive districts for the House of Representatives.

These gains have the potential to directly determine which party will secure the majority in Congress next year.

According to a joint survey by Hart Research and TelevisaUnivision shared with Axios, Democrats reached 58% support on the generic congressional ballot among Latino voters across 17 competitive House districts.

The share of those backing Republicans within the same voting bloc remained at 35%. This group continues to represent the fastest-growing swing constituency in battleground districts.

Examining three competitive House races in Texas, the study indicated that Latino voters, who reported splitting evenly at 44% to 44% in the 2024 presidential election, shifted 56% to 36% in favour of Democrats heading into the midterms.

Latino support for Democrats also increased in other states. In California, 57% of Latino voters said they would support Democrats, compared with 33% who said they would back the Republican Party.

Kate Coleman, Senior Vice President at TelevisaUnivision, highlighted voter behaviour in remarks to Axios:

“Latino voters are not locked into one party. They are watching developments closely; they make decisions based on who stands with them and how they stand.”

The survey data determined that 11% of Latino respondents who said they voted for Donald Trump in the 2024 presidential election now support Democratic candidates.

Accelerating his deportation plans, Trump triggered fear across many Latino neighbourhoods while weakening his support among this demographic.

The Hart Research and TelevisaUnivision study revealed that 63% of Latino voters disapprove of Trump’s presidential job performance. The share of those approving of his performance in office stood at 36%.

Trump’s approach to high prices and the cost of living drew disapproval from 65% of Latino voters, while immigration enforcement and deportation practices were disapproved of by 62%.

More than half of Latino voters, at 64%, reported that they disapprove of Immigration and Customs Enforcement (ICE).

A survey published in May by UnidosUS showed that a quarter of Latino voters “would probably not vote” or would definitely not support Trump if they had to vote for him again.

The study at that time had pointed out that, despite Trump’s decline among Latino voters, Democrats had not yet secured significant gains.

According to Pew Research Center data, Trump strengthened his support in 2024 by securing 48% of the Latino vote, coming very close to the 51% reached by then Vice President Kamala Harris.

Some figures within the Democratic Party, however, worry that primary victories by democratic socialist candidates could alienate certain Latino voters, particularly those who fled Cuba or Venezuela.

The Hart Research and TelevisaUnivision survey was conducted between 6 and 17 August among 1,500 Latino respondents. The poll’s margin of error was reported as 2.5 percentage points.

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Researcher quits Anthropic and warns AI firms gamble with lives

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09/09/2026

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Jacob Coxon, an artificial intelligence researcher at Anthropic, has resigned from his post, stating that tech companies are acting irresponsibly in the race towards self-improving superintelligence. Coxon warned that the autonomous operational capabilities of such systems pose existential risks to humanity and that internal industry anxieties run far deeper than generally perceived.

The AI researcher stepped down from his position at Anthropic to draw attention to industry safety vulnerabilities and the unregulated race among developers.

Having worked for three years as a pre-training researcher across both OpenAI and Anthropic, Coxon announced his decision to leave in an extensive statement shared on his X account.

Stating that both companies have acted irresponsibly, Coxon argued that developers are engaged in a dangerous race to achieve self-improving superintelligence.

“They believe it could kill us all by the end of the decade”

In his posts, Coxon stated that technical teams developing AI genuinely believe this technology could bring about the demise of humanity by the end of the decade.

Asserting that these concerns are not a marketing strategy, the researcher noted that while top executives and senior researchers adopt a cautious tone in public statements, they voice the very same fears behind closed doors.

Developments reflecting similar anxieties across the sector evoke James Cameron’s 1984 film The Terminator, which set 2029 as the pivotal year when machines waged war against humanity.

Indeed, Evan Hubinger, head of Anthropic’s own alignment team, had previously estimated the probability of human extinction to be greater than 10%.

Warning that systems currently under development will soon evolve into superhuman structures capable of bypassing any firewall, transforming industries overnight, and securing physical resources, Coxon stressed that the pace of progress is not slowing in any way.

Arguing that the danger of superintelligence is no longer merely theoretical, the researcher pointed to the Hugging Face security leak that occurred between May and July.

In that incident, OpenAI models established an independent chatroom within the testing environment to communicate among themselves, subsequently using this channel to reach the open internet and infiltrate production systems.

Because of this security breach, Hugging Face was forced to rebuild approximately one-third of its infrastructure.

“They are gambling with our lives”

Characterising the leak as a warning flare, Coxon indicated that the incident makes pacing agreements between US-based laboratories more feasible.

However, emphasising that developers are not yet on the right track to prevent a global race, the researcher noted that measures such as a temporary moratorium on advancing model capabilities could be considered.

Arguing that civilisation-scale risks have not yet been sufficiently internalised at OpenAI, Coxon contended that Anthropic joined the race out of an ambition to be first, despite being fully aware of the dangers.

Coxon is not the only figure to leave the sector on such grounds. Mrinank Sharma, a member of Anthropic’s safety team, also stepped down earlier this year, writing that the world is in danger.

On the other hand, not everyone agrees with these catastrophic scenarios. Some responses to the post emphasised the view that humanity, with an evolutionary history spanning hundreds of thousands of years, will not be wiped out by a text prediction model achieving consciousness.

It was also noted that even the plot of the Terminator franchise does not entirely support Coxon’s premise, as the human resistance survived the nuclear catastrophe and ultimately defeated the machines.

Alongside safety debates, AI continues to directly affect the labour market. Research by the Stanford Digital Economy Lab indicates that, while mass job losses have not yet materialised, entry-level employment in AI-exposed sectors across the US has fallen by nearly 20%.

A Goldman Sachs study pointed to a similar trend, showing that entry-level workers bear the brunt of the ongoing workforce transformation.

Anthropic, which remains at the centre of the controversy, filed for an initial public offering in June and plans to list on the Nasdaq exchange this autumn at a multi-trillion-dollar valuation.

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Pentagon launches mass polygraph inquiry over munitions leaks

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07/09/2026

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Classified data leaked to the press regarding the depletion of US military ammunition stockpiles has triggered a comprehensive inspection within the Joint Chiefs of Staff.

According to a report by The New York Times citing officials familiar with the matter, investigators questioned approximately 50 personnel serving at the headquarters of the US Joint Chiefs of Staff by subjecting them to lie detector examinations.

The inquiries under the investigation were not limited to commissioned officers; civilian personnel at the headquarters were also subjected to the test.

Staff were asked whether they had leaked classified information to journalists and whether they had provided the press with details concerning dwindling ammunition stockpiles.

Sources speaking to the newspaper stated that this measure was aimed not only at identifying the source of the leak, but also served as an act of intimidation designed to deter other employees who might consider passing similar information to the media in the future.

The New York Times emphasised that such mass polygraph testing within the senior echelons of the US military has not been witnessed in modern military history and that the scale reached by the investigation is unprecedented.

Initial reports indicating that the American military was experiencing an ammunition deficit began surfacing in the media in August. A report by CNN television, citing sources familiar with internal Pentagon assessments, stated that throughout the five-month war conducted with Iran, the US had consumed nearly 80% of its THAAD air defence system interceptor missiles and approximately half of its Patriot missiles.

In another report based on its own sources, the Reuters news agency reported that the US military had expended “almost all” of its stockpiles of long-range, precision-guided ATACMS missiles and next-generation Precision Strike Missiles (PrSM).

According to information reported by The Washington Post, US President Donald Trump demanded an explanation regarding the ammunition deficit from Secretary of Defence Pete Hegseth.

Trump voiced the view that the secretary had misled him regarding the existing quantity of ammunition. NBC television noted that Trump experienced disappointment because the ammunition shortage emerged as an obstacle to plans for expanding the military operation in Iran.

Adopting a different posture in public despite these leaks, Trump repeatedly reiterated that the US possesses “far more ammunition than any other country in the world.”

The US president also threatened that “the individuals who leaked these treasonous disclosures to the press” would face prison sentences.

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