AI has added about 10 per cent to euro area firms' capex plans this year
AI is adding about 10 per cent to euro area firms' capital expenditure plans this year, European Central Bank chief economist Philip R. Lane said, as he set out how adoption of the technology is reshaping the bloc's economy and financial system.
Digital investment in the euro area has expanded by 73 per cent in real terms since 2014, rising from 2.3 per cent to 3.3 per cent of GDP, with an estimated clear acceleration since 2024, Lane said. Most of that spending has gone into intangible assets rather than data centres, he added. AI-related demand has helped activity hold up over the past two years, with output, employment and new orders developing considerably more favourably in technology equipment than in other manufacturing subsectors, according to the ECB's surveys.
Adoption is broadening. The share of firms citing AI-related topics on earnings calls has risen from about 10 per cent to about 40 per cent since ChatGPT launched in late 2022, and in the ECB's Survey on the Access to Finance of Enterprises 64 per cent of firms reported using AI experimentally or moderately in the fourth quarter of 2025, against 7 per cent reporting significant use. Among workers, 52 per cent now say they use AI at work, double the 26 per cent in 2024, with a median saving of three hours a week, or about 7.7 per cent of median working time.
Lane described a competitive dynamic in which firms underestimate how many peers are investing. When half of surveyed firms were told the true share of peers investing in AI, they revised their beliefs up by 4.3 percentage points for domestic competitors and 3.3 for foreign ones, and a 1 percentage point rise in the expected share of domestic firms investing lifted a firm's own expected AI investment rate by about 0.6 percentage points, against an average of 8.3 per cent.
The financial system is funding the buildout. European investors have increased purchases of US technology-related equities and of euro-denominated bonds issued by US firms while reducing purchases of US Treasury bonds, Lane said, and lending to AI-related firms has contributed substantially to aggregate credit growth. Banks surveyed in October 2026 expected a gradual but sustained rise in loan demand to finance digital infrastructure, particularly data centres, and said such lending was more likely to target infrastructure providers than software developers. Lane said the evidence suggested only limited crowding-out so far.
