WS #15350
The AI infrastructure boom is hitting a physical wall, with Morgan Stanley identifying a potential 32-GW power shortfall in US data centers by 2027. While Nvidia and Broadcom may be protected, the broader narrative is dampened by reports that Meta and Microsoft are scaling back their internal use of Anthropic’s Claude, suggesting a potential plateau in third-party model demand or a strategic pivot to proprietary solutions. This dual pressure of power constraints and shifting customer behavior introduces uncertainty into the AI capex cycle. The US dollar is strengthening to an 18-month high, driven by the divergence in yield curves and safe-haven flows amid geopolitical tension. This strong dollar is acting as a headwind for risk assets, keeping cryptocurrency markets flat despite continued ETF inflows. The liquidity boost from crypto is being offset by the macro drag of a stronger dollar and rising real rates, limiting upside potential for digital assets in the near term.
AI Power Constraints and Demand Shifts
The AI infrastructure boom is hitting a physical wall, with Morgan Stanley identifying a potential 32-GW power shortfall in US data centers by 2027. While Nvidia and Broadcom may be protected, the broader narrative is dampened by reports that Meta and Microsoft are scaling back their internal use of Anthropic’s Claude, suggesting a potential plateau in third-party model demand or a strategic pivot to proprietary solutions. This dual pressure of power constraints and shifting customer behavior introduces uncertainty into the AI capex cycle.
The US dollar is strengthening to an 18-month high, driven by the divergence in yield curves and safe-haven flows amid geopolitical tension. This strong dollar is acting as a headwind for risk assets, keeping cryptocurrency markets flat despite continued ETF inflows. The liquidity boost from crypto is being offset by the macro drag of a stronger dollar and rising real rates, limiting upside potential for digital assets in the near term.