The Asia-Pacific economy is losing steam, but the artificial intelligence (AI) boom is cushioning the blow. According to a new Moody’s Analytics report, regional GDP growth is projected to dip from 4.3% in 2025 to 4.2% in 2026, and then to 3.6% in 2027. Analysts point out that without the rapid buildout of AI infrastructure, the slowdown would be hitting a lot harder.

Exports and Manufacturing Ride the AI Wave

Moody’s Analytics describes the Asia-Pacific economy as running at “two speeds.” On one hand, surging demand for AI infrastructure is powering exports and manufacturing. On the other, inflation and tighter monetary policy are putting the brakes on the rest of the economy.

Who’s Winning From the AI Surge

The biggest winners are economies plugged into the semiconductor, memory, and AI hardware supply chains. These sectors are keeping export numbers afloat and helping the region maintain growth momentum even as the broader economy cools.

Regional Outlook: AI as a Safety Net

The Moody’s Analytics report stresses that the Asia-Pacific slowdown would be much sharper without the current AI boom. The AI sector has become a key driver, helping the region offset the pain from inflation and tighter monetary policy. Over the next few years, demand for AI infrastructure is expected to remain a major force shaping the region’s economic outlook.