[Bank of Japan Warns AI Demand May Drive Inflation Higher] BlockBeats News, August 3: On Monday, the Bank of Japan stated that global demand related to artificial intelligence could exert sustained upward pressure on Japan's inflation, signaling the bank's growing concern over inflation risks, which may further strengthen its case for a recent interest rate hike. The Bank of Japan noted that, in the medium to long term, the application of artificial intelligence should enhance productivity and, as businesses and workers gradually adapt to AI technology, exert downward pressure on prices. However, the Bank of Japan stated: "In the short term, the inflationary impact of the AI-driven investment boom may outweigh the effects of productivity improvements." The reason is that stronger investment activity will boost demand and drive prices higher. The Bank of Japan also pointed out that the rise in global producer prices is partly due to oil price increases caused by conflicts in the Middle East and partly due to a "positive global demand shock" for AI-related goods. The report stated that the spillover effects of AI demand will persist for some time. Additionally, combined with the rising import costs caused by the depreciation of the yen, domestic inflation in Japan may continue to face sustained upward pressure. (Jin10)