{"id":74592,"date":"2026-11-12T14:38:17","date_gmt":"2026-11-12T18:38:17","guid":{"rendered":"https:\/\/www2.stockmarketwatch.com\/stock-market-news\/feds-daly-warns-of-ai-driven-inflation-as-microsoft-outage-hits-130000-users\/74592\/"},"modified":"2026-11-12T14:38:17","modified_gmt":"2026-11-12T18:38:17","slug":"feds-daly-warns-of-ai-driven-inflation-as-microsoft-outage-hits-130000-users","status":"publish","type":"post","link":"https:\/\/www2.stockmarketwatch.com\/stock-market-news\/feds-daly-warns-of-ai-driven-inflation-as-microsoft-outage-hits-130000-users\/74592\/","title":{"rendered":"Fed\u2019s Daly Warns of AI-Driven Inflation as Microsoft Outage Hits 130,000 Users"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_89 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 eztoc-toggle-hide-by-default' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"#\" data-href=\"https:\/\/www2.stockmarketwatch.com\/stock-market-news\/feds-daly-warns-of-ai-driven-inflation-as-microsoft-outage-hits-130000-users\/74592\/#Key_Takeaways\" >Key Takeaways<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"#\" data-href=\"https:\/\/www2.stockmarketwatch.com\/stock-market-news\/feds-daly-warns-of-ai-driven-inflation-as-microsoft-outage-hits-130000-users\/74592\/#Feds_Daly_Highlights_AI_Inflation_Risks\" >Fed\u2019s Daly Highlights AI Inflation Risks<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"#\" data-href=\"https:\/\/www2.stockmarketwatch.com\/stock-market-news\/feds-daly-warns-of-ai-driven-inflation-as-microsoft-outage-hits-130000-users\/74592\/#Widespread_Microsoft_Outage_Disrupts_Business\" >Widespread Microsoft Outage Disrupts Business<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"#\" data-href=\"https:\/\/www2.stockmarketwatch.com\/stock-market-news\/feds-daly-warns-of-ai-driven-inflation-as-microsoft-outage-hits-130000-users\/74592\/#Google_Search_Receives_%22Gemini_4_Hydrogen%22_Upgrade\" >Google Search Receives &quot;Gemini 4 Hydrogen&quot; Upgrade<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"#\" data-href=\"https:\/\/www2.stockmarketwatch.com\/stock-market-news\/feds-daly-warns-of-ai-driven-inflation-as-microsoft-outage-hits-130000-users\/74592\/#Treasury_Market_30-Year_Auction_Faces_Weak_Demand\" >Treasury Market: 30-Year Auction Faces Weak Demand<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"#\" data-href=\"https:\/\/www2.stockmarketwatch.com\/stock-market-news\/feds-daly-warns-of-ai-driven-inflation-as-microsoft-outage-hits-130000-users\/74592\/#Global_Tensions_Israel_and_China\" >Global Tensions: Israel and China<\/a><\/li><\/ul><\/nav><\/div>\n<h2><span class=\"ez-toc-section\" id=\"Key_Takeaways\"><\/span>Key Takeaways<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<ul>\n<li><strong>Fed\u2019s Mary Daly warns AI is fueling &quot;price pressures&quot;<\/strong> in semiconductors and data centers, though its direct contribution to current inflation remains modest.<\/li>\n<li><strong><a href=\"https:\/\/stockmarketwatch.com\/stock\/MSFT\" data-internallinksmanager029f6b8e52c=\"18\" title=\"Stock: MSFT\">Microsoft<\/a> (<a href=\"\/stock\/MSFT\">MSFT<\/a>) suffers a massive service outage<\/strong> affecting over 130,000 users across Outlook, Teams, and <a href=\"https:\/\/stockmarketwatch.com\/stock\/MSFT\" data-internallinksmanager029f6b8e52c=\"18\" title=\"Stock: MSFT\">Microsoft<\/a> 365 in the U.S. and Canada.<\/li>\n<li><strong>Google (<a href=\"\/stock\/GOOGL\">GOOGL<\/a>) launches Gemini 4 Hydrogen<\/strong>, a major Search upgrade that is reportedly 2.5 times faster than previous models.<\/li>\n<li><strong>U.S. 30-Year Bond auction &quot;tails&quot; on soft demand<\/strong>, with the high yield landing at 5.441% as investors demand a higher premium.<\/li>\n<li><strong>Geopolitical tensions escalate<\/strong> as U.S. CENTCOM reportedly advises Israel to prepare for a possible resumption of hostilities with Iran.<\/li>\n<\/ul>\n<h2><span class=\"ez-toc-section\" id=\"Feds_Daly_Highlights_AI_Inflation_Risks\"><\/span>Fed\u2019s Daly Highlights AI Inflation Risks<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>San Francisco Federal Reserve President <strong>Mary Daly<\/strong> stated on Thursday that while the economy is being driven by a significant technology boom, there is &quot;no doubt&quot; that <strong>AI-fueled demand is creating price pressures<\/strong>. Daly noted that the AI pipeline remains deep and is unlikely to dry up even if the pace of development slows. She emphasized that while AI&#39;s direct impact on the labor market and current inflation is currently limited, it poses a <strong>long-term risk of contributing more to inflation<\/strong> through sustained supply shocks in the tech sector.<\/p>\n<p>Daly\u2019s comments come as the Federal Reserve continues to monitor a &quot;stuck&quot; inflation rate, which sat at <strong>3.7% year-over-year<\/strong> in recent reports. She indicated that the solid labor market provides the central bank with &quot;room to focus on inflation,&quot; suggesting that <strong>further interest rate hikes<\/strong> may be necessary to bring prices down to the Fed&#39;s 2% target.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Widespread_Microsoft_Outage_Disrupts_Business\"><\/span>Widespread Microsoft Outage Disrupts Business<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><a href=\"https:\/\/stockmarketwatch.com\/stock\/MSFT\" data-internallinksmanager029f6b8e52c=\"18\" title=\"Stock: MSFT\">Microsoft<\/a> (<a href=\"\/stock\/MSFT\">MSFT<\/a>) experienced a significant service disruption on Thursday, with <strong>Downdetector<\/strong> recording over <strong>130,000 reports of issues with Outlook<\/strong> at its peak. The outage also impacted <strong>Microsoft 365, Teams, and the Microsoft Store<\/strong>, leaving thousands of users in the U.S. and Canada unable to send emails or access cloud services. Microsoft confirmed it is investigating issues with <strong>Exchange Online mailboxes<\/strong> in the Americas, though some reports suggest connectivity issues may be affecting other global regions.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Google_Search_Receives_%22Gemini_4_Hydrogen%22_Upgrade\"><\/span>Google Search Receives &quot;Gemini 4 Hydrogen&quot; Upgrade<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Alphabet (<a href=\"\/stock\/GOOGL\">GOOGL<\/a>)&#39;s Google announced a &quot;massive upgrade&quot; to its search engine with the global rollout of <strong>Gemini 4 Hydrogen<\/strong>. According to Google, the new model is <strong>2.5 times faster<\/strong> than Gemini 3.8 Flash and offers improved reasoning for complex, multi-part queries. The update aims to provide more <strong>visual and intuitive responses<\/strong>, including comparison tables and structured data, marking the largest model improvement to Google Search to date.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Treasury_Market_30-Year_Auction_Faces_Weak_Demand\"><\/span>Treasury Market: 30-Year Auction Faces Weak Demand<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>The U.S. Treasury\u2019s sale of <strong>$25 billion in 30-year bonds<\/strong> saw lackluster interest on Thursday, resulting in a &quot;tail&quot; where the high yield of <strong>5.441%<\/strong> exceeded the when-issued yield of 5.437%. The <strong>bid-to-cover ratio fell to 2.36<\/strong>, down from 2.54 in the previous auction, signaling a cooling appetite for long-term government debt. <strong>Indirect bidders<\/strong>, a category that includes foreign central banks, took only <strong>68.1% of the offering<\/strong>, a notable decline from the 72.3% seen in the prior sale.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Global_Tensions_Israel_and_China\"><\/span>Global Tensions: Israel and China<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>In geopolitical developments, <strong>U.S. CENTCOM<\/strong> has reportedly alerted the Israeli military to prepare for a <strong>potential resumption of war<\/strong> with Iran. This comes amid reports that Iran has added new demands to ongoing negotiations, which U.S. officials described as &quot;overreaching.&quot; Simultaneously, the <em>Wall Street Journal<\/em> reports that <strong>Beijing is seeking $15 billion in funds<\/strong> to establish a Chinese rival for insuring world shipping, a move aimed at reducing China&#39;s reliance on Western-dominated maritime insurance hubs.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Key Takeaways Fed\u2019s Mary Daly warns AI is fueling &quot;price pressures&quot; in semiconductors and data centers, though its direct contribution 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