Central bankers are preparing for an era in which AI-driven investment keeps interest rates high and forces governments to tighten budgets after years of cheap money. The global race for capital tied to AI is pushing policymakers to abandon hopes of a return to cheap credit. Spending on chips, data centres, power grids and telecom networks is boosting growth while pushing up borrowing costs, a dual effect at the heart of the policy challenge facing central banks.
Summary written by Upside AI from the original article. Read the source for full details.
Read the original on en.shafaqna.com ↗
Related news
- Stocks are heading for a high - stakes showdown , as strong earnings collide with rising borrowing costs
Wall Street faces a tug-of-war as booming earnings for technology and energy firms collide with a relentless rise in bond yields, which have reached their highest levels in decades. Analysts expect earnings to keep soaring on AI data center build-outs, while oil prices, pushed into triple-digit territory by the war with Iran, add pressure on consumers. The market has split into AI and non-AI stocks, and AI stocks sold off last week as Treasury yields fell and investors questioned the AI-driven growth story. Valuations have slumped: the S&P 500 trades at 19 times expected earnings, below its five-year and 10-year averages, according to FactSet. Fidelity's Jurrien Timmer said earnings growth and the rising cost of capital are in a race to determine stock prices.
- Stocks are heading for a high-stakes showdown, as strong earnings collide with rising borrowing costs
- FM Sitharaman pushes municipal bonds for urban funding amid rising borrowing costs
- FM Sitharaman pushes municipal bonds for urban funding amid rising borrowing costs
Union Finance Minister Nirmala Sitharaman called for stronger municipal finances and more bond-based funding for urban infrastructure, as rising borrowing costs make it harder for Indian cities to raise money from capital markets. She said cities need stronger own-source revenues, credible accounts and financially viable projects to attract private investors, and stressed that public investment must continue alongside private funding. The Reserve Bank of India raised its benchmark repo rate by 25 basis points to 5.50% earlier this month, and government bond yields have also risen. She pointed to the Urban Challenge Fund, backed by Rs 1 lakh crore in central assistance and aimed at mobilising Rs 4 lakh crore in total urban investment, and to a Tamil Nadu model in which 13 urban local bodies jointly raised funds through a bond for water and sanitation.
- Vietnam orders push to slash lending rates amid surging borrowing costs
The deputy prime minister urged the State Bank of Vietnam (SBV) to swiftly cut lending rates by 1.5–2 percentage points for production, business and government-prioritized sectors, while keeping financial stability and inflation under control. The push comes as the average lending rate reached 10.7% in August, up 0.2 percentage points from July and around three percentage points from a year earlier; personal loans reached 17–18%, and some banks' deposit rates neared 10%. Small and medium-sized businesses said they still struggle to access preferential credit, and one food business owner repaid a 9–10% loan but was quoted 13–14% for a new one. The government also ordered tighter supervision over bad debts, risky real estate lending, cross-ownership and banking misconduct, requiring banks to publicly disclose lending rates and facing penalties for noncompliance. BIDV launched short-term dong loans from six percent a year on October 15, and Vietcombank pledged to cut lending rates by at least two percentage points a year through the end of 2026.
- America's $10 trillion AI data centre boom faces delays, rising costs and investor concerns
Data centre projects in America's $10 trillion AI infrastructure boom are facing delays, cancellations, blocks and weaker investor confidence. RegLayer counted at least 47 large projects delayed, withdrawn or blocked in 2026, while Bernstein estimated only about 35% of the planned US pipeline is credible. More than 1,000 communities have tried to introduce temporary bans or restrictions on AI infrastructure in 2026, and rising borrowing costs threaten financing for neocloud firms. CoreWeave's stock lost almost 25% in a week, and several IPOs, including SoftBank's SB Energy and Nvidia-backed Firmus, were delayed or shelved. Construction delays could let customers cancel: Cipher agreed to cover the first $359 million of cost overruns on a Texas project tied to Anthropic, and Anthropic could cancel its $45 billion Nscale agreement if targets are missed.
Related markets
Latest news
- Saudi Arabia postpones big investor conference to 2027 as Iran-backed Houthis escalate attacks on kingdom
Saudi Arabia has postponed its major annual investor conference until 2027 as Iran-backed Houthi militants escalate missile and drone attacks on the kingdom. The Future Investment Initiative had been scheduled for Riyadh from October 26 to 29. The decision follows a Houthi attack on King Khalid International Airport in Riyadh on October 10, which left at least 12 people dead and more than 300 injured. Organizers said in an email that new dates will be announced soon.
- Russia fires mysterious weapon at Kyiv, shockwaves spread; President Putin appears in rare image, drawing global attention
On the night of 18 Oct, Russia launched a coordinated strike on multiple Ukrainian targets using ballistic missiles, cruise missiles and Geran UAVs, focused on Kyiv. According to TST, around 10 ballistic missiles of the Iskander-M, S-400 or KN-23 types may have been used in the first wave; an above-ground metro station on Kyiv's left bank was reported damaged, disrupting rail and metro services, and videos of blue flashes led observers to suspect a new weapon. In western Ukraine, a 330 kV transformer station near Kovel may have been targeted. Meanwhile, Putin, who rarely appears in military uniform, visited a command post and stressed establishing a “security zone” along the border; blogger Yuri Podolyaka argued Moscow no longer treats these areas as bargaining chips. Front-line correspondent Alexander Kots said the part of Donetsk still controlled by Ukraine is just over 2,700 km².
- Semiconductor Sell-Off: 5 Stocks to Buy on the Dip
The article attributes the semiconductor selloff to investor doubts about the durability of AI infrastructure spending, even as cloud companies report strong demand for AI chips. It highlights five stocks: Nvidia (forward P/E just above 13.5 on fiscal 2028 estimates), Broadcom (custom AI chips, with that revenue expected to quadruple to $230 billion over two years; forward P/E of 11), AMD (riding inference and agentic AI demand), Cerebras Systems (high risk-reward; the company claims 30 times the inference speed of GPUs) and TSMC (forward P/E of 18 on 2027 estimates).
- Tom Lee’s Bitmine Adds $30 Million in Ethereum as Buying Nears Its Finish Line
Bitmine bought another 12,535 ETH (about $30 million), lifting its holdings to 6,041,481 ETH, or 4.9% of supply and 99% of its 5% target. Chairman Tom Lee blamed the crypto selloff on a broad risk-off shift, including AI funding and safety worries, U.S.-Iran tensions, midterm jitters and rising bond yields, and called the dip a historically attractive risk-reward entry. Total holdings reached $15.1 billion as of Oct. 18, including 215 Bitcoin, $582 million in cash and marketable securities, and other investments. About 84% of its ETH (5,067,309 tokens) is staked via its MAVAN platform, with projected annualized revenue of roughly $309 million. The position is currently underwater on paper because much of it was bought at higher prices.
- Opinion: The Most Important Number in Taiwan Semiconductor's Earnings Report Was 68%
The author argues the most important figure in TSMC's Q3 report is 68%, the share of revenue from high-performance computing (HPC), which grew 22% from the prior quarter. Revenue reached $46.72 billion, up 41.2% year over year, net income rose 68.7%, and gross margin hit 66.4%. Processes at 7nm and below made up 79% of wafer revenue, with 3nm at 33% and 2nm at 8%. TSMC guided Q4 revenue to $52.3–54.3 billion and expects roughly 44% full-year growth in U.S. dollars. The author remains bullish, saying ongoing demand for advanced AI chips should keep profits rising.
- Why Meta's Q3 earnings could be a little hard to interpret
Meta is reporting its third-quarter earnings after the market closes Wednesday, and Yahoo Finance's Brian Sozzi says the report will be hard to interpret. Recent good news on Meta's AI products, including new models and an AI agent, may not appear directly in the results but will likely be discussed on the earnings call. The key uncertainty is how investors will react if Meta raises its capex outlook again: it could be seen as fueling those products, or as overspending on offerings not yet reflected in financials. Sozzi expects the market to give Meta the benefit of the doubt on higher capex, as long as the increase does not shock investors.
Get the briefing on Telegram or Zalo
Join the Upside Telegram channel or Zalo group for the Vietnam stocks and gold briefing at 8:00 and 19:00 (Vietnam time) on trading days, plus a weekly wrap on Saturday morning.