The United States now drives more than half of the global credit impulse, with artificial intelligence spending fueling the bulk of that expansion. But the same boom is creating a risk: if AI investments falter, the ripple effects could destabilize equity valuations and economic growth worldwide, according to recent analysis.
What a credit impulse means
Credit impulse tracks the change in new credit creation as a share of gross domestic product. When the number rises, it signals that borrowing is accelerating relative to economic output. The US share of that global measure has climbed sharply in recent quarters, largely because corporate and government debt tied to AI buildouts has surged.
That makes the American economy the central engine of global credit expansion—a position that comes with outsized influence and, potentially, outsized vulnerability.
AI spending as the primary driver
Spending on artificial intelligence infrastructure—data centers, specialized chips, energy systems—has become a major source of new borrowing. Companies are raising capital to build out computing capacity, while governments issue debt to fund AI-related research and incentives. This wave of credit creation is concentrated in the US, which accounts for more than half of the total global impulse.
The concentration means that any pullback in AI investment could have an immediate effect on credit markets. If companies pause or scale back projects, the flow of new credit would slow, and the global impulse would shrink sharply.
The risk of a faltering AI boom
Analysts warn that a sustained slowdown in AI spending would not only reduce credit creation but also hit equity valuations. Many stock prices currently reflect expectations of future AI-driven profits. If those expectations sour, a correction could spread from tech stocks into broader markets. That, in turn, could tighten financial conditions and slow economic growth—both in the US and in economies that rely on American demand and capital flows.
The mechanism is straightforward: less AI spending means less borrowing, less investment, and less confidence. The global credit impulse, heavily tilted toward the US, would turn negative, amplifying the downturn.
What comes next
No one knows how long the AI investment wave will last. Regulators and central banks are watching closely, but they haven't signaled any intention to intervene. The question hanging over markets is whether the current pace of AI-driven credit expansion is sustainable—or whether a correction is inevitable.
