About this work
Successful AI investment could raise the equilibrium real interest rate by increasing desired investment relative to saving. Demand for energy, computing infrastructure, equipment and skilled workers is already rising, while lasting unit-labor-cost reductions are less evident. A lower equilibrium rate would require a weaker-growth scenario, potentially involving sustained labor-market damage. The authors therefore caution against assuming AI will restore the very low real rates of the 2010s.
Cite this work
Marcello Estevão, Jonathan Fortun (2026). IIF Global Macro Views: The Star Is Rising. Institute of International Finance.