Trending Now - Jerome Powell Attributes Rising Bills to Data Centers' Impact on Inflation

WHO:

Jerome Powell, Chair of the Federal Reserve

Goldman Sachs, financial services company

Wood Mackenzie, research and consultancy firm

WHAT:

Powell stated that the AI-fueled data center boom is contributing to inflation.

Powell mentioned that the Federal Reserve's long-run growth estimates were revised up from 1.8% to 2%.

Consumer electricity prices are projected to jump 6% from 2026 to 2027.

Utilities requested a record $31 billion in rate increases in 2025, more than double the prior year.

Only a third of data center projects in the pipeline are under active development.

WHERE:

The statements were made during a press conference, location unspecified.

WHEN:

The press conference took place on Wednesday, March 18th, 2026.

The warning from Goldman Sachs was issued in February 2026.

The record rate increase request by utilities occurred in 2025.

WHY:

Powell indicated that the massive physical buildout required to power AI is putting pressure on goods and services, contributing to inflation.

The disinflationary benefits of AI remain theoretical at this time.

HOW:

Powell explained that the demand side of the economy is running ahead of any productivity payoff from AI.

(UPDATED March 20, 2026 01:26 UTC)

During a press conference on Wednesday, March 18, 2026, Federal Reserve Chair Jerome Powell highlighted that the AI-driven boom in data centers is contributing to rising inflation. He noted that the Fed has revised its long-run growth estimates up from 1.8% to 2%, while also warning that consumer electricity prices are expected to jump 6% from 2026 to 2027, with utilities requesting a record $31 billion in rate increases. Powell emphasized that the massive infrastructure needed to support AI is putting pressure on goods and services, and he pointed out that only a third of data center projects are currently under active development.