Renowned Economist Argues AI Revolution Will Fuel Inflation, Not Deflation, and Signals a Commodities Supercycle

On July 16th, the "2026 Sina Global Capital Summit," organized by Sina Finance, was held in Hong Kong, China. The event, themed "Rooted in Hong Kong, with a Global Vision," brought together leading figures from global politics, business, academia, and research to engage in in-depth discussions on key topics including global capital market trends, cross-border capital allocation, and the international expansion of technology firms.

The summit featured a distinguished roster of speakers, including senior political figures, international financial organization representatives, top investment bankers, industry leaders, and academic pioneers.

Hong Hao, a prominent economist and Chief Investment Officer of LH Investment Management, attended and delivered a speech at the event.

While the prevailing market view is that AI technology will enhance efficiency and curb inflation, Hong Hao presented a starkly contrasting perspective.

He argued that the AI revolution is more likely to bring about inflation, not deflation. He posited that the AI revolution is, in essence, a supercycle revolution for commodities. If commodities enter a supercycle while the relative importance of human labor in the overall economic structure diminishes, then the classic theories of inflation will largely lose their explanatory power. "In general, inflation will become easier to rise and harder to fall," Hong Hao emphasized.

This view stands in sharp contrast to the classic theory previously articulated by Alan Greenspan. Hong Hao pointed out that Greenspan believed inflation would not occur even with significant money printing, as long as the growth rate of labor productivity far exceeded the rate of wage increases. However, regarding whether the AI revolution can genuinely enhance total factor productivity (TFP), Hong Hao stated, "at the very least, we cannot jump to that conclusion so easily."

He warned that the future inflation landscape will be entirely different from the past four decades, and global inflation levels are likely to rise further.