US TECHNOLOGY: Intel: US Government 10% Stake

Source: Bloomberg Finance L.P./MNI 

President Donald Trump is shortly due to deliver the keynote address to the ‘Winning the AI Race’ summit in Washington D.C, where he will formally unveil his administration’s 'AI Action Plan' and sign an executive order that will “kick-start data center construction on federal sites,” per Politico. LIVESTREAM

• As noted in an earlier bullet, the plan purports to "accelerate AI innovation" by removing "red tape" and "onerous regulation". It lays out a strategy for building AI infrastructure by developing "streamlined permitting for data centres" and "restoring semiconductor manufacturing".
• The plan advocates for "exporting American AI to allies and partners" and countering "Chinese influence in international governance bodies". It outlines a raft of policy proposals to develop AI talent and "new infrastructure- factories to produce chips, data centers to run those chips, and new sources of energy to power it all."
• It states that American energy capacity has "stagnated" while China has "rapidly built out their grid,". Says that "America's path to AI dominance depends on changing this troubling trend."
• The plan outlines "three pillars: innovation, infrastructure, and international diplomacy and security." Arguing that the US needs innovate faster and more comprehensively than our competitors..."
• Janet Egan, at The Center for a New American Security, said the plan represents a market shift in strategy from "a primarily restrictive approach to AI" under Biden to a focus on answering the question "how do you start spreading the infrastructure and the technology that will underpin the globe?"

Inflation expectations across the two quarterly BOC surveys were mixed in Q2 but generally pointed to stabilization from Q1.

• In the BOS, the share of firms predicting inflation of 2-3% in the next 2 years rose to 51% from 44% prior. But that was probably the most concerning result from the survey and in any case only reverted back to the Q4 2024 level. The percent seeing 3+% inflation was steady at 23% though that's well below the 70-80% amid the 2022 inflationary episode.
• Meanwhile in the CSCE, consumer expectations of price increases largely abated.
• Inflation is currently seen at 3.82% (a 15-quarter low), with 1Y expectations down 5bp to 4.04% and 2Y down 4bp to 3.85%.
• In the most worrying finding, 5Y out expectations ticked up 6bp to 3.45%,a 14-quarter high.
• But generally speaking these were little changed from the prior quarter's survey and should offer the BOC some confidence that inflation expectations aren't becoming de-anchored by the US-Canada tariff conflict.