Odaily Planet Daily reports: Cathie Wood, founder of ARK Invest, said that while the recent U.S. jobs report appears concerning on the surface, deeper economic trends are shifting, with rising productivity, expanding AI adoption, and potential deflationary pressures likely to become the key market themes ahead.
Wood noted that the U.S. federal budget deficit as a percentage of GDP is currently around 5.6%, nearing levels seen during the Reagan era in the 1980s. She believes that if productivity and technology adoption continue to accelerate as ARK expects, this ratio could fall to approximately 5% by year-end, although most economic forecasting institutions consider this target difficult to achieve.
Regarding inflation, Wood believes the market is underestimating deflationary risks. She notes that recent inflation data have consistently come in below expectations: CPI fell 0.4% month-over-month in June, PPI declined 0.3% month-over-month, and core PCE rose just 0.1% month-over-month. She argues that companies that fail to adopt AI and productivity tools may face greater pricing pressures and competitive risks in the future.
Wood is also bullish on the dollar. ARK’s data model based on Kalshi prediction markets suggests the U.S. Dollar Index could rise to 102.6 this year. She refutes the view that foreign capital is selling off U.S. assets, noting that Japan’s recent foreign exchange intervention primarily involved selling euros and buying yen, not selling dollars.
In the energy market, Wood believes a global oversupply of crude oil is emerging. She notes that the UAE’s production has risen to record highs following its exit from OPEC, and further declines in oil prices could become a deflationary driver for the global economy.
Regarding the AI investment boom, Wood said concerns about an AI bubble are exaggerated, and the current growth in capital expenditures may represent the early stage of a long-term technological revolution rather than a short-term speculative cycle.
In the cryptocurrency space, Wood stated that Bitcoin's performance relative to gold is stabilizing, and she believes that as the "agentic commerce" economy develops, Bitcoin and stablecoins may be the biggest beneficiaries.