SF Fed president: AI demand could extend energy shock

AxiosOctober 6, 2026en

Some companies are preparing for an AI-fueled chip squeeze that could push up prices far beyond the data center boom alone, Mary Daly, president of the Federal Reserve Bank of San Francisco, tells Axios. Why it matters: The Fed can usually look through supply shocks that come and go. Daly's concern is that AI, tariffs and higher energy costs could last longer than expected or compound each other — keeping inflation elevated and requiring more tightening. State of play: Daly says AI demand could spread beyond high-end chips before supply catches up, extending the shock beyond the period the Fed would normally expect to look through. "I see it less as a one-off," she says, referring to AI-driv

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