AI Boom Drives Record US Inflation in Software and Memory Prices
Consumer software prices surged 14.5% YoY in May, the biggest annual increase on record, while electronic component producer prices jumped 27% YoY, also a record. Memory chip prices more than doubled, with DDR5 and DDR4 RAM up 290% YoY, as AI data centers absorb global supply.
Consumer prices for computer software and accessories rose 14.5% year-over-year in May, the largest annual gain since records began in 2000, according to data cited by The Kobeissi Letter. Producer prices for electronic components soared 27% YoY, also an all-time record. Prior to this year, prices for these categories had declined in nearly every year since 2000.
Memory prices have been the primary driver: DDR5 and DDR4 RAM prices surged 290% YoY as AI data centers consume the vast majority of global chip supply. The RAM price shock is expected to keep inflation elevated well into 2027, compounding existing price pressures from the Iran War.
The AI boom is now a direct source of technology-led inflation, with production constraints pushing prices ever higher.
Source: The Kobeissi Letter