In dinner remarks at the International AI Summit, European Central Bank Executive Board member Philip R. Lane assessed how artificial intelligence is affecting the euro area economy and the ECB’s policy responsibilities. AI is already supporting business investment, digital services, demand for European supply chain goods and corporate lending, although no material effect on aggregate productivity is yet visible. Over time, it could raise potential output and help offset the economic impact of Europe’s shrinking working age population. Euro area firms are set to direct about 10% of their total investment to AI in 2026, while AI-related lending accounts for roughly one quarter of recent growth in credit to firms. In a fourth-quarter 2025 survey, 64% of firms reported experimental or moderate AI use and 7% reported significant use. The share of workers using AI at work has doubled to 52% from 26% in 2024, but time savings remain concentrated in particular sectors and tasks. Aggregate employment has not shifted materially, though hiring plans are muted, particularly for new graduates, and substitution risks could weaken workers’ bargaining power. Europe nevertheless trails the United States and East Asia in AI investment, workplace use and computing capacity. Lane said the global AI investment boom may be contributing to higher long-term interest rates, with spillovers materially tightening euro area financial conditions and affecting monetary policy. High AI company valuations and rising debt issuance also create financial stability risks if technological expectations or investor sentiment reverse, while the ECB’s financial stability and banking supervision functions are monitoring related financial and cyber risks.
European Central Bank Executive Board member Philip Lane assesses AI support for investment and risks from higher rates and valuations
In remarks at the International AI Summit, European Central Bank Executive Board member Philip R. Lane said AI is supporting euro area investment and credit growth, although no material aggregate productivity impact is yet visible. Firms are set to direct about 10% of 2026 investment to AI, and AI-related lending represents roughly one quarter of recent growth in credit to firms. The global boom may also be lifting long-term rates, while high valuations, debt issuance and cyber threats create financial stability and supervisory risks.