BOJ deputy governor warns of market correction risk from AI boom
Bank of Japan deputy governor Shinichi Uchida said on Oct 5 that the global AI boom has been "a big positive demand shock" that eased financial conditions by stoking demand and boosting asset prices. He said "there is a risk of correction if profits do not follow," and said huge bond issuance by AI-related firms is already pushing up long-term interest rates. The BOJ has identified AI-related demand as among factors that could push inflation above its 2% target, necessitating further tightening.
NoteA central bank naming AI-linked bond issuance as a force on long-term yields means lenders and investors exposed to the AI buildout should expect that link to show up in the next rate decision as well as the next earnings call.
Read the original
The Morning Note, by email
The AI-in-finance stories that matter, before work
One short email each morning, readable in under three minutes. Free, and you can leave anytime.