Issue Risk: an AI investment correction could combine with bond market stress

Summary

The report warns that AI-related investment, a key upside factor for world trade and capital spending until recently, could slow if cost pressures and financial tightening deepen. Heavy market concentration in a small number of big tech companies makes such an adjustment more consequential. A correction could spread through risk-asset aversion, tighter corporate financing conditions and weaker investment. Combined with instability in government bond markets, this could produce a broader form of financial tightening. The risk links the AI investment cycle directly to the fiscal and bond market vulnerabilities identified in the outlook, so a turn in AI spending would not stay confined to the technology sector.