Bill Ackman says AI capital expenditure may weaken the effects of Fed rate hikes

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Bill Ackman warns that Fed rate hikes could backfire,AI Capital expenditure may weaken the effects of tightening

BlockBeats reports that,September 28, billionaire investor Bill Ackman said that the Fed's decision to raise the benchmark interest rate by 25 basis points to 3.75%—4.00%could be a mistake. He believes that AI the arms race is driving technology giants to continue expanding capital expenditure. Even as financing costs rise, companies may continue building data centers and purchasing computing capacity, thereby weakening the traditional suppressive effect of rate hikes on investment demand; at the same time, higher interest costs may also be transmitted to the prices of goods and services through supply chains and pricing mechanisms, further increasing inflationary pressure.

Ackman said that the current AI investment boom may be changing the traditional monetary policy transmission mechanism. Bridgewater data shows that the AI investment by Alphabet, Amazon, Meta, and Microsoft this year is expected to reach at least 650000000000 USD; Gartner expects 2026 global AI spending to reach 2700000000000 USD in 49.5%year-on-year growth.

Mark Zandi, chief economist at Moody's Analytics, also previously said that the Fed raising rates at this time could be “a mistake,” warning that if the Fed wants to bring inflation back to its 2%target, it may need to restrain the AI investment boom or further suppress other parts of the economy.

U.S. inflation is currently still above the Fed's 2%target, and the market is also pricing in further rate hikes.CME FedWatch data shows that the 30-day federal funds futures-implied October rate-hike probability is approximately 64%.

Original link https://m.theblockbeats.info/flash/369383

Key points

The report cites Bill Ackman as saying that the Fed raising the benchmark interest rate by 25 basis points to 3.75%—4.00%could be a mistake.
Ackman believes that the AI arms race is driving technology giants to expand capital expenditure, which may weaken the traditional suppressive effect of rate hikes on investment demand.
Bridgewater data shows that the AI related investment by Alphabet, Amazon, Meta, and Microsoft this year is expected to reach at least 650000000000 USD。
Gartner expects 2026 global AI spending in the year to reach 2700000000000 USD, with 49.5%。
The report cites CME FedWatch as saying that the October rate-hike probability is approximately 64%。
Mark Zandi also previously said that the Fed raising rates at this time could be a mistake.

AI-assisted interpretation

The following is analysis, separate from reported facts. Verify important claims independently.

Rate hikes generally increase financing costs and suppress investment. The view expressed in the report is that technology companies may continue building data centers and purchasing computing capacity because of AI competition, so the suppressive effect of rate hikes on investment may weaken; higher interest costs may also increase price pressures through supply chains and pricing mechanisms.

Why it matters to readers

This reflects that AI the scale of investment may affect the market's assessment of the effects of rate hikes and the subsequent interest-rate path.

Beginners can understand it as follows: rate hikes may not be equally effective in reducing AI related investment, and inflation and interest-rate expectations may still change.

Risks and unknowns

This is a secondary report published by BlockBeats and does not provide direct evidence of Bill Ackman's original statements.
The Bridgewater, Gartner, and CME FedWatch data cited in the article do not provide original data links or a complete methodology.
It is impossible to confirm solely from this material whether AI capital expenditure actually weakened the effects of rate hikes.
The report does not provide the original Fed decision or specific figures for inflation data.

Bill Ackman says AI capital expenditure may weaken the effects of Fed rate hikes

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