The head of the International Monetary Fund (IMF) said that the current global boom in artificial intelligence investment is helping economies absorb some of the trade and growth shocks caused by the war in the Middle East. Although the conflict has cooled expansion — the IMF revised its 2026 global growth forecast down by 0.5 percentage points — broad AI spending has helped cushion the impact.
Market reaction and risks
Investors have warned about bubble risks, but frontier AI labs remain bullish on the market’s potential. Anthropic recently raised its estimate of AI’s total addressable market to $30 trillion, a figure roughly equivalent to the size of the U.S. economy.
Companies and IPO prospects
The AI investment wave has also accelerated public listing plans for some companies. According to the South China Morning Post, Chinese AI firm DeepSeek is reportedly eyeing a 2027 initial public offering.
Why this matters
The IMF’s assessment highlights that technology investment can have measurable macroeconomic effects that mitigate traditional demand shocks. At the same time, high valuations and investor concerns indicate underlying risks that warrant monitoring. In short, continued AI spending and optimistic market projections have partly offset the negative economic effects of the Middle East conflict, even as the IMF’s downgraded 2026 forecast reflects ongoing uncertainty.
