Shafaqna English– The head of the Bank for International Settlements, Pablo Hernandez de Cos, cautioned that AI’s swift ascent is producing novel risks for financial stability.
He noted that the sheer volume of spending on AI-related infrastructure has already reached a level where it can materially affect global economic conditions.
This suggests that AI is not merely a technological revolution but also a significant economic force, with the potential to reshape financial markets, investment flows, and economic policymaking on a global scale.
While AI does not alter the mandates of central banks, it does make their task of interpreting the economy more complex.
By affecting demand, supply, and financial markets at the same time, AI generates economic signals that are harder to separate and analyze.
This complexity can hinder central banks’ ability to make informed policy decisions, as they must now navigate an economic landscape where AI-driven changes blur traditional indicators and relationships.
Source: Reuters