The Federal Reserve just named a new villain in its inflation fight, and it’s not tariffs or oil prices. It’s artificial intelligence.
FOMC minutes from the June 16-17 meeting, released on July 8, reveal that Fed officials flagged robust demand for AI infrastructure as a meaningful source of upward price pressure. The culprits: semiconductors, computer equipment, and electricity. In English: the world’s insatiable appetite for GPUs and data centers is making everything more expensive, and the Fed has officially noticed.
What the minutes actually say
Fed officials noted that AI demand would likely sustain upward pressure on prices for technology and electricity products. That’s a notable departure from earlier FOMC discussions, which had mostly treated AI as a productivity story or a financial stability curiosity rather than an active inflation accelerant.
The central bank held interest rates steady at 3.50%-3.75% during the meeting. But the staff raised inflation projections for both 2026 and 2027, a move that lands squarely in hawkish territory.
