AI investment is giving the US an edge – can it last?
The AI boom is reinforcing America’s economic edge, even as questions linger over its longevity.
The AI investment boom has significantly boosted the US economy compared to other advanced economies. Apart from one or two small pockets, there’s scant evidence of a substantial tech-driven increase in capital spending elsewhere.
We expect this trend will continue in 2026, solidifying the US growth outperformance against other major advanced economies.
Spending on computers has been the backbone of the US tech spending boom, prompting US computer production to surge while boosting exports from Mexico, Vietnam, and Taiwan particularly. Over the past three years, some Asian economies’ entire rise in exports has been driven by computers and semiconductors.
Digital tech investment as a share of GDP is now as high as it was at the peak of the dot-com bubble. But this doesn’t mean the boom will come shuddering to a halt next year.
A potential catalyst for the boom turning to bust is disappointing take up of AI. Tariffs on US semiconductor imports could also discourage AI-related investment. However, we anticipate President Donald Trump will be wary of provoking a technology-focused equity market downturn due to sweeping tariffs on chips. Tariff exemptions for the most advanced chips employed in AI would be likely.
