The Reserve Bank of Australia has limited evidence that artificial intelligence has significantly boosted labour productivity or caused large-scale job losses. At the same time, the technology may increase risks to financial stability, the bank’s Deputy Governor (Economic), Sarah Hunter, said at a UBS conference in Sydney, Channel NewsAsia reports.
Impact on inflation
According to Hunter, AI’s impact on inflation will change over time. At the initial stage, investment in this technology may increase demand and intensify price pressures when the economy’s capacity to expand supply is limited.
Later, supply may catch up with demand as the capacity of data centres and related sectors expands, she said. If AI delivers broader productivity growth, economies will be able to produce more with the same resources, and the initial inflationary pressure from investment in the technology should ease.
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Signs of changes in the labour market
The boom in domestic investment in data centres has strengthened demand in the Australian economy. According to the source, this was one of the reasons why the Reserve Bank of Australia raised interest rates five times this year, bringing them to 4.85% — the highest level in 18 years.
Hunter also said there are early signs of adaptation: job postings and employment indicators are weakening in occupations most exposed to AI. At the same time, stronger growth is being observed in sectors where the technology has less impact, particularly among young workers. She warned that asset prices could adjust sharply or in a disorderly manner if returns on AI investments fail to meet expectations.
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