A new “chipflation” threat is brewing in the economy, Morgan Stanley analysts warn.
Memory chip prices have surged by up to 600 percent in the past year, driven by a global shortage of Random Access Memory, or RAM, amid intensifying artificial intelligence (AI) demand.
Product scarcity has driven up the share price of various chip stocks. Year-to-date, Nvidia has surged 27 percent, Advanced Micro Devices (AMD) has rocketed 320 percent, and Intel has climbed 73 percent.
As the technology sector prioritizes AI infrastructure investment, particularly data center chips, everyday consumer products have taken a back seat.
The AI hyperscalers—Alphabet, Amazon, Meta Platforms, Microsoft, and Oracle—have updated their capital expenditure forecasts for the year ahead to nearly $1 trillion combined….
