Key Assessments: AI will suppress long-term yields in the US and Europe in the long term, but the path will be one of initial upward movement followed by a decline. Allianz estimates that under an optimistic AI scenario, the final yield on 10-year US and European government bonds will be approximately 50 basis points lower than without an AI benchmark over the next decade. Yields will rise significantly in the early stages, with bond assets exhibiting a "pressure first, benefit later" characteristic, lacking a one-sided holding logic.
Transmission Mechanism and Regional Differentiation: Early AI capital expenditure expansion will create a shock to funding, energy, and financing needs. By 2026, global AI investment will exceed $1 trillion, with the US exceeding $500 billion, accounting for 1.8% of US GDP. Long-term bond issuance by AI companies will compete with government bonds for funds, pushing up the US 10-year yield by approximately 34 basis points at its peak. The key variable in the later stages is the realization of AI productivity. If economic growth and tax revenue improve the fiscal situation, fiscal channels alone can lower the US 10-year yield by approximately 85 basis points. The US debt-to-GDP ratio is expected to continue rising, making it more dependent on AI growth dividends; Europe's debt path is stable, with lower dependence on AI dividends.
