Bank of America CEO Brian Moynihan is ending 2025 with a message that’s equal parts upbeat and wary: consumer spending is still growing, the U.S. economy looks positioned for solid growth in 2026, and artificial intelligence is starting to show measurable economic lift. But the next year, in his view, will also be shaped by a familiar trio of destabilizers—policy uncertainty, geopolitical shocks, and the real-world infrastructure constraints behind the AI boom.
In a recent interview on CBS’s Face the Nation (filmed Dec. 17, aired Dec. 21; transcript published Dec. 28), Moynihan said Bank of America’s transaction data shows spending rose about 4% to 4.5% versus the prior year across the November holiday period, even as many Americans report feeling squeezed by affordability and inflation. [1]
Days earlier on Bloomberg Television, Moynihan argued that the “AI investment” wave has been building and that AI’s economic benefits are “kicking in more” as a marginal—but increasingly meaningful—tailwind. [2]
At the same time, Bank of America’s research arm has laid out a detailed “10 trends” framework for 2026—ranging from above-consensus U.S. GDP growth and AI capex to emerging markets, Treasuries, housing, and a copper market shaped by tight supply and rising demand. [3]
What emerges across those threads is a coherent story: 2026 could be the year the economy shifts from a consumer-led expansion to something more capex- and infrastructure-driven—powered by AI, constrained by electricity and materials, and buffeted by policy and geopolitical risk.
Consumers Are Still Spending—Even When They Say They’re Struggling
Moynihan’s core economic takeaway is the tension between how people feel and how they spend.
On Face the Nation, he said Bank of America sees overall spending around the Thanksgiving-to-early-December window running up roughly 4% to 4.5% year over year. And while spending growth varies by income group, he emphasized that all “three buckets” (lower, middle, and upper income tiers) were still growing. [4]
He also pointed to what he described as solid credit quality and continued job support, even as inflation remains a major emotional drag: wages have risen, but “inflation bothers people,” he said—one reason sentiment can stay sour even when aggregate spending holds up. [5]
That dynamic matters because, in Moynihan’s telling, the single biggest swing factor for 2026 is whether the U.S. consumer stays engaged. He said Bank of America sees U.S. growth “about 2.4% next year,” but he framed it as conditional: if consumers pull back meaningfully, the economy slows with them. [6]
That 2.4% number is also central to Bank of America Global Research’s formal 2026 forecast. In a Dec. 2 press release, the firm’s senior U.S. economist Aditya Bhave projected 4Q/4Q GDP growth of 2.4% in 2026, citing fiscal and tax-related boosts, trade policy clarity, and the lagged impact of Fed easing. [7]
Tariffs, Trade Clarity, and Small Business “Waiting for an Answer”
Moynihan repeatedly returned to the theme of uncertainty—not just what policies will be, but how fast businesses can adapt once the rules are clear.
In the CBS interview, he described an earlier period of “shock” around trade and tariffs and said Bank of America now projects a direction of “de escalation, not escalation” in the broad global tariff posture—while noting that China is a “different question” tied to national security concerns and supply chains. [8]
He also linked policy uncertainty directly to small business behavior. He said smaller firms were hit by the combination of higher rates (raising the cost of revolving credit) and tariff uncertainty (not knowing input costs), but that their attention has increasingly shifted toward labor availability—particularly amid unsettled immigration policy. His summary of what small businesses want was simple: “give me a set of rules and I’ll go play with them.” [9]
This concern about hiring and uncertainty shows up in broader CEO sentiment as well. Business Roundtable’s Q4 2025 CEO Economic Outlook Survey reported that hiring plans improved slightly but remained below the threshold signaling expansion, and it noted that more CEOs anticipated employment decreases than increases for a third consecutive quarter. Business Roundtable CEO Joshua Bolten explicitly tied softening hiring plans to an environment where AI is driving capex and productivity gains while tariff volatility is increasing costs. [10]
“AI Is Kicking In More”: From Bank Chatbots to Macro Growth
Moynihan’s AI message has two layers: what AI is already doing inside Bank of America—and what he believes AI investment is doing to the economy.
AI inside Bank of America: “Erica” and productivity
On CBS, Moynihan highlighted Bank of America’s digital assistant “Erica” as the most visible consumer-facing AI example, saying it handles about 2 million customer interactions per day, is actively used by around 20 million customers, and can answer hundreds of questions. [11]
He also emphasized a key constraint in financial services: customer-facing AI requires tighter controls, because the cost of a wrong answer is higher when outcomes involve credit decisions or risk. [12]
When asked about job impacts, Moynihan leaned toward the “efficiency enables growth” argument—pointing to historical technology waves and noting that Bank of America still hired more than 2,000 new college graduates recently. [13]
AI at the macro level: investment that spills into growth
In the Bloomberg Television interview reported by Bloomberg on Dec. 22, Moynihan said AI’s economic effects are starting to show more clearly: AI investment has been building and should become a bigger contributor “next year and the years beyond,” with AI “kicking in more and more” as a marginal boost. [14]
Bank of America Global Research’s own outlook underscores that view, saying AI investment has already boosted GDP growth and is expected to continue growing in 2026. [15]
But it also highlights the tension that investors and policymakers will likely grapple with in 2026: AI can accelerate growth, yet its effects on inflation, corporate investment, and market structure can also increase volatility. [16]
The Hidden Bottleneck: Electricity, Data Centers, and the Physical AI Economy
One reason Bank of America’s 2026 market narrative keeps circling back to commodities—especially copper—is that the AI boom is not purely digital. It is intensely physical.
The International Energy Agency (IEA) estimates data centers consumed about 415 TWh in 2024—around 1.5% of global electricity use—and projects data center electricity demand will more than double to roughly 945 TWh by 2030, with AI the most important driver. The IEA also expects the United States to account for the largest share of the increase, and says U.S. data centers represent nearly half of U.S. electricity demand growth between now and 2030. [17]
The IEA warns that grid connection queues, equipment lead times, and transmission buildouts can delay projects—putting a portion of planned data center development at risk of bottlenecks. [18]
Pew Research, citing IEA estimates, adds U.S.-specific scale: U.S. data centers consumed about 183 TWh in 2024 (more than 4% of total U.S. electricity use) and could rise sharply by 2030. [19]
Bank of America’s own wealth and strategy commentary echoes this “power” framing. In a 2026 outlook piece, Merrill and Bank of America Private Bank CIO Chris Hyzy argues that “power” is shaping the 2026 economy—from energy grids and data centers to defense systems and digital platforms. [20]
Taken together, these points form a clear thesis: if AI is the growth engine, electricity capacity and grid infrastructure are the fuel system—and constraints in that system can shape everything from corporate capex to commodity prices.
Bank of America’s 10 Macro Trends for 2026 Markets—Explained
A late-December summary of Bank of America’s “10 trends” (highlighted by Proactive Investors) lays out what the bank expects to matter most across the U.S., China, rates, equities, private credit, and commodities. [21]
But the underlying source is Bank of America’s own Dec. 2 Global Research release, which names the forecasts and the strategists behind them. [22]
Here’s what the 10 trends mean—and why they connect back to Moynihan’s consumer-and-AI narrative.
1) U.S. GDP growth: above consensus at 2.4% (4Q/4Q)
Bank of America Global Research’s Aditya Bhave forecasts 2.4% U.S. GDP growth (4Q/4Q) in 2026, citing policy and fiscal tailwinds, including the “One Big Beautiful Bill Act,” a restoration of certain tax benefits, and the lagged effect of Fed rate cuts. [23]
Moynihan’s version of the same story: growth holds as long as consumers keep spending and businesses keep employing and raising wages modestly. [24]
2) AI boom, but “no bubble yet” (with a volatility caveat)
Bank of America’s research leadership, including Candace Browning, says the firm remains bullish on AI investment continuing in 2026 and argues imminent “AI bubble” concerns are overstated. [25]
Proactive’s summary captures the nuance many investors are watching: AI monetization remains uncertain, and power supply could become a bottleneck even if investment continues. [26]
3) Emerging markets: a supportive macro mix
BofA’s David Hauner expects a weaker U.S. dollar, lower rates, and low oil prices to help set a constructive backdrop for emerging markets in 2026. [27]
4) China: upgraded growth outlook
BofA’s Helen Qiao raised the firm’s China forecast, expecting 4.7% growth in 2026 and 4.5% in 2027, citing positive signs in trade and stimulus effects with upside risks. [28]
5) Stocks: strong earnings, muted index price gains
Savita Subramanian, BofA’s head of U.S. equity strategy, expects 14% EPS growth but only 4%–5% S&P 500 price appreciation, with a year-end target of 7,100 for the index—suggesting valuations and leadership concentration could limit index-level upside even if profits grow. [29]
Context matters here: Reuters reported in late December that optimism about AI, economic resilience, and expected policy easing helped keep major U.S. indexes on track for a strong year, with the S&P 500 up about 17% in 2025. [30]
6) Rates: 10-year yields could “surprise to the downside,” with Fed cuts expected
BofA’s Mark Cabana expects the 10-year Treasury to end 2026 around 4% to 4.25%, with downside risk, while BofA economists expected additional Fed cuts in 2026. [31]
Moynihan’s CBS comments are broadly aligned: he said Bank of America’s team doesn’t expect 10-year rates to fall dramatically and described a band of roughly 4% to 4.5% for the 10-year—implying mortgage rates may not drop as much as many households hope. [32]
7) Housing: flat home prices, improving turnover
BofA’s Chris Flanagan and the securitized products team expect flat home price appreciation and improving housing turnover, with upside risk depending on Fed policy. [33]
Moynihan emphasized a related point: the U.S. housing market has a supply problem, and permitting and building more homes is a more durable affordability solution than hoping for a large rate drop. [34]
8) Volatility: likely, as AI’s real impact becomes clearer
BofA expects volatility as markets digest how AI affects growth, inflation, and capex, and it flags “K-shaped” dynamics and fiscal dominance as sources of turbulence. [35]
This ties directly to Moynihan’s “sentiment vs spending” theme: when households feel squeezed, markets can re-price faster than the underlying economy changes. [36]
9) Private credit: returns likely lower; high yield more attractive
Neha Khoda, BofA’s head of U.S. credit strategy, expects private credit total returns around 5.4% in 2026, down from about 9% in 2025—potentially reshaping allocations toward other income assets. [37]
10) Copper: tight supply meets structural demand
BofA metals strategist Michael Widmer expects copper to perform well amid continued supply challenges and tailwinds from easier policy, reduced uncertainty, and renewed demand. [38]
Proactive’s summary places copper alongside AI in the same macro narrative: commodity tightness and infrastructure spending can become the “real economy” expression of the AI investment boom. [39]
Why Copper Is Becoming the “AI Metal” (and a 2026 Market Flashpoint)
Copper isn’t just an inflation hedge or an old-school industrial barometer anymore. It’s increasingly positioned as a constraint on two of the defining economic projects of this decade: electrification and digital infrastructure.
UN Trade and Development (UNCTAD) warned in 2025 that copper is “the new strategic raw material” for clean energy and digital technologies—including data centers and AI infrastructure—and said global copper demand could surge more than 40% by 2040, with mine development timelines and concentration of reserves creating structural challenges. UNCTAD estimated meeting future demand may require roughly 80 new mines and $250 billion in investment by 2030. [40]
The International Energy Agency’s Global Critical Minerals Outlook 2025 similarly frames copper as central to the energy transition minerals story, tracking demand and supply risks across scenarios. [41]
Even among Wall Street commodity forecasters, the debate for 2026 often isn’t whether copper matters—it’s how tight the market gets and how policy changes affect trade flows. Goldman Sachs Research, for example, expects copper prices to cool from record highs in 2026 but still hold in a high range (roughly $10,000–$11,000 per tonne), explicitly tying demand support to grid and power infrastructure investment, including strategic sectors such as AI and defense. [42]
Put plainly: if AI data centers are a major driver of electricity demand growth, and electricity infrastructure buildouts require large volumes of copper, then copper becomes a lever on the pace—and cost—of the AI buildout itself.
The Bottom Line for 2026: Cautious Optimism, Built on the Consumer—and the Grid
Across Moynihan’s interviews and Bank of America’s research outlook, 2026 is shaping up as a year when three forces collide:
- A still-resilient U.S. consumer, spending more than sentiment surveys would imply—yet still sensitive to affordability and inflation fatigue. [43]
- A capex-heavy AI cycle, which Moynihan says is beginning to show real economic benefit—and which BofA argues is not yet in bubble territory, even as volatility risks rise. [44]
- Hard physical constraints—especially electricity capacity, grid buildouts, and materials like copper—that could determine how quickly AI investment translates into productivity and growth. [45]
Moynihan’s most practical warning may also be the simplest: the outlook depends on whether people keep spending—and whether policy clarity arrives fast enough for businesses (especially small businesses) to commit to hiring, inventory, and investment decisions. [46]
References
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